U.S. July Retail Sales Rise 1.8%; Ex-Autos Increase 0.3% *(what is behind the rise in bonds IMHO)
Aug. 11 (Bloomberg) -- U.S. retail sales rose 1.8 percent in July, led by a jump in auto purchases and surging receipts at service stations that reflected record gasoline prices. The splurge on cars and fuel left consumers with less money to spend on anything else.
Last month's gain was less than forecast and followed a 1.7 percent June increase, the Commerce Department said today in Washington. Excluding autos, sales rose 0.3 percent, half as much as economists forecast. Also subtracting purchases at service stations, sales were unchanged.
``The recent run-up in gasoline prices took a big chomp out of consumers' wallets,'' said Nigel Gault, director of U.S. research at Global Insight Inc., a Lexington, Massachusetts-based forecasting firm, before the report. ``Even though auto sales were up in July in response to producer discount programs, the persistence of high gasoline prices is going to restrain spending in the month of August as well.''
Flat sales excluding autos and gasoline compares with an average 0.6 percent increase in the first six months of the year. Retailers including Neiman Marcus Group Inc. and J.C. Penney Co. posted smaller-than-expected sales gains in July as hot weather hurt demand for fall clothing, according to industry reports last week. Even higher fuel costs this month raise concern incomes will fail to keep pace, threatening to slow consumer purchases and economic growth later this year, economists said.
Economists expected retail sales would rise 2.1 percent last month, based on the median forecast of 72 estimates in a Bloomberg News survey. Sales excluding automobiles were expected to rise 0.6 percent following a 0.9 percent June increase.
Retail sales account for almost half of all consumer spending, which in turn accounts for about two-thirds of the economy.
Auto Sales
Sales at automobile dealerships and parts stores rose 6.7 percent last month, the most since October 2001, after rising 4.6 percent in June.
Ford Motor Co. and DaimlerChrysler AG's Chrysler unit last month matched GM's offer to extend employee discounts to all buyers. Carmakers sold 20.9 million vehicles at an annual rate last month, second only to the 21.9 million in October 2001.
Sales at filling stations increased 2.4 percent last month following a 2 percent rise in June. A jump in gasoline prices may have played a hand in boosting sales. The average price for a gallon of gasoline at the pump reached $2.33 last month, the most ever, from $2.20 in June, according to figures from the Energy Department. The average price reached a record $2.41 a gallon in the week ended Aug. 8.
Gasoline
Record gasoline prices are ``a concern,'' said Edward Zander, chief executive of Motorola Inc., the No. 2 cell phone maker, in an interview. ``If the cost of living goes up and consumers have less to purchase, this may be one item that that gets impacted, even though we don't see that yet.''
Average hourly earnings were up 2.7 percent in the 12 months ended in July, barely above the 2.5 percent increase in consumer prices in the year ended in June, according to figures from the Labor Department.
Stores selling building materials and garden supplies showed a 0.4 percent drop in sales last month following a 0.3 percent rise in June.
Sales in the retail group used to calculate gross domestic product figures on consumer spending, which excludes autos, gasoline and building materials, rose 0.1 percent last month following a 0.8 percent June increase. The government uses data from other sources to calculate the contribution from the three categories excluded.
Department Stores
Sales at general merchandise stores, which include department stores, were unchanged last month after rising 1.3 percent. Sales at clothing and accessory stores dropped 0.5 percent after a 1.1 percent increase. Department stores sold 1 percent less merchandise.
Near-record heat last month led to a mixed sales performance at chain stores, an industry report last week showed. Retailers including Neiman Marcus Group Inc. and J.C. Penney Co. posted smaller-than-expected sales gains in July as the weather hurt demand for fall clothing, according to a survey by the International Council of Shopping Centers. Discount chains, including Wal-Mart Stores Inc. and Target Corp., posted better results, helped by sales of patio furniture, sunscreen and bottled water.
Sales at electronics and appliance stores rose 1 percent, while furniture sales fell 1.3 percent, today's report showed. Purchases at sporting goods, hobby, book and music outlets increased 0.5 percent while sales at food and beverage stores fell 0.1 percent. Sales at restaurants and drinking places rose 0.2 percent.
Fed
Non-store retailers, which include online purchases and catalog sales, dropped 0.1 percent in July after a 2.7 percent increase a month earlier.
Sales of the sixth Harry Potter book, a novel by J.K. Rowling chronicling the adventures of a young wizard, will help third- quarter sales at Amazon.com rise as much as 30 percent, compared with the same period last year, the world's largest online retailer said last month. The book, titled ``Harry Potter and the Half-Blood Prince'' shattered first-day sales records.
Fed policy makers on Aug. 9 raised their target for the benchmark overnight bank lending rate to 3.5 percent from 3.25 percent, the 10th straight quarter-point increase.
``Aggregate spending, despite high energy prices, appears to have strengthened since late winter, and labor market conditions continue to improve gradually'' the central bankers said in the statement announcing the rate increase.
Consumer spending this quarter may grow at a 3.7 percent annual pace, 0.5 percentage point faster than forecast last month and the most since the last three months of 2004, according to the median estimate of economists surveyed this month by Bloomberg News.
The gain in spending will help lift economic growth to a 4.1 percent annual pace this quarter, after a 3.4 percent rate from April through June, the survey showed.
More hiring and rising incomes, together with the auto discounts, are fueling the burst in spending, economists said. Employers added 207,000 workers to payrolls in July, more than expected, and wages grew at the most in a year, the Labor Department said last week.
-- With reporting by Mike McKee in New York and Bill Koenig in Southfield, Michigan. Editor: Golle To contact the reporter on this story:
Carlos Torres in Washington ctorres2@bloomberg.net.
Last Updated: August 11, 2005 08:30 EDT
Thursday, August 11, 2005
HUI and DO WE?
http://tinyurl.com/a347q easier to see what kind of MOMO compared to previous top readings, a descending MACD, BUT rising long term MA's
Newmont Gold
Coming up to underside trendline from MArch and June lows This could be end of rise if it holds, a kiss of sorts?
D
D
GOOG ALERT
It was Cabott Newsletter which stated (a BUY!) "GOOG isn't likely to ever see $284 again....." heloooo, now under $284 near $282.
These BULLISH newsletters feel they have to have you invested, no matter what?
BULLISH sentiment at all time high? YES, higher than 2000 IIAA poll, 146 weeks straight of BULLS in plurality, and spread of bulls less bears near highest level seen, and in area that has seen a top be put in.
MArkets NOT moving in unison, disjointed, also suspect of topping action. BOND yields so far today resilient considering bullish ebbing sentiment.
GOLD popping, I don't see SILVER confirming, so I am taking no action as yet. still expect a steep decline to below $400 in coming months...unless old highs are taken out along with Silver
These BULLISH newsletters feel they have to have you invested, no matter what?
BULLISH sentiment at all time high? YES, higher than 2000 IIAA poll, 146 weeks straight of BULLS in plurality, and spread of bulls less bears near highest level seen, and in area that has seen a top be put in.
MArkets NOT moving in unison, disjointed, also suspect of topping action. BOND yields so far today resilient considering bullish ebbing sentiment.
GOLD popping, I don't see SILVER confirming, so I am taking no action as yet. still expect a steep decline to below $400 in coming months...unless old highs are taken out along with Silver
INVENTORY to SALES RATIO
http://www.briefing.com/Silver/Calendars/EconomicReleases/businv.htm I don’t see anything bullish here, inventories have been falling for 15 years so record low is no concern. Sales and inventories seem neck and neck rather normal
I wonder since we don’t make anything anymore, and it is shipped set up ready to go from China, a GOOD reason for above?!
2 sources of knowledge I confided in say wait on Bonds, still cogitating.
Market bouncing this AM, I don't think a new high is in offing.
D
I wonder since we don’t make anything anymore, and it is shipped set up ready to go from China, a GOOD reason for above?!
2 sources of knowledge I confided in say wait on Bonds, still cogitating.
Market bouncing this AM, I don't think a new high is in offing.
D
CRYING TIME?
Bond sentiment is now near where it made its last low in price, high in yield. So, with so few bulls left, the short term top may have arrived.
Yields off a tad this AM, data does not suggest a swift reversal, but there is tons of room to retrace some of the recent gains in yields, IMHO
Top of dowtrend channel is right here, so again given sentiment, a breach of this channel seems unlikely. ONE misnoamer would be CHILLY reception of the 5 yr auction I posted this AM.
So, it just doesn't get to easy, conflicting feelings, one waning bullish sentiment, and luke warm foreign purchasing of the auction of debt, which could lead to a calamity.
That's the picture as I see it. AM's data shows without Auto's (last month giveaway) consumers may be slowing at the buffet.
D
Yields off a tad this AM, data does not suggest a swift reversal, but there is tons of room to retrace some of the recent gains in yields, IMHO
Top of dowtrend channel is right here, so again given sentiment, a breach of this channel seems unlikely. ONE misnoamer would be CHILLY reception of the 5 yr auction I posted this AM.
So, it just doesn't get to easy, conflicting feelings, one waning bullish sentiment, and luke warm foreign purchasing of the auction of debt, which could lead to a calamity.
That's the picture as I see it. AM's data shows without Auto's (last month giveaway) consumers may be slowing at the buffet.
D
Wednesday, August 10, 2005
A Hydrogen Economy? a BUSH economy?
Electrolysis
From Solar Today
More than one way to invest in energy. Yet energy bill did not seem to impact the Fuel cell stocks I follow.
HYGS bought Stuart Energy and from what I read are leaders in refueling technology, interesting company.But stock lays dormant, as many times they do with potential accumulation.
Or, that is pie in the sky stuff not in our lifetime.
ANother interesting site RenewableEnergyAccess Where you gonna get this kind of digging?
LAstly a piece on BUSH Highway bill MORE PORK than a hog farm, of course the dude from Alaska got 4th highest pet project money...DOH he chairs the committee!!! WHERE is all this MONEY coming from?
Yes, let the GOV spend OUR money instead of US in a free economy, with bUSH we got Cronies, we got wise guys, we got waste, we got war, we got BIGGER GOV, surprise!
D
From Solar Today
More than one way to invest in energy. Yet energy bill did not seem to impact the Fuel cell stocks I follow.
HYGS bought Stuart Energy and from what I read are leaders in refueling technology, interesting company.But stock lays dormant, as many times they do with potential accumulation.
Or, that is pie in the sky stuff not in our lifetime.
ANother interesting site RenewableEnergyAccess Where you gonna get this kind of digging?
LAstly a piece on BUSH Highway bill MORE PORK than a hog farm, of course the dude from Alaska got 4th highest pet project money...DOH he chairs the committee!!! WHERE is all this MONEY coming from?
Yes, let the GOV spend OUR money instead of US in a free economy, with bUSH we got Cronies, we got wise guys, we got waste, we got war, we got BIGGER GOV, surprise!
D
Wednesday Post Market Commentary
Maybe my feel is coming back? STocks indeed got stage fright today and the near 2 day zing zagged after all.Quite a level to get fried from as well, hard to say if this reversal is key or not just yet.
NDX is looking toppy. Money flow weakened when compared to previous June high. We're under the 20 EMA which appears to be turning down.
Weekly performance not too impressive either with weak (RED) money flow on thr rise and ROC turning down.When MACD added, the histograms (BLUE BARS) have stoped rising, a close below ZERO would solidify the move.
The DOW? we're at the convergence area of the 2 moving averages.A close below would drive the 10 WK back down IMHO. Almost forgot, the VIX dropped today!
Entering period of seasonal weakness. Bradley cycle is turned down thru year end.
Did $65 OIL spook market? when $64 didn't? Go Hummer
Duratek
NDX is looking toppy. Money flow weakened when compared to previous June high. We're under the 20 EMA which appears to be turning down.
Weekly performance not too impressive either with weak (RED) money flow on thr rise and ROC turning down.When MACD added, the histograms (BLUE BARS) have stoped rising, a close below ZERO would solidify the move.
The DOW? we're at the convergence area of the 2 moving averages.A close below would drive the 10 WK back down IMHO. Almost forgot, the VIX dropped today!
Entering period of seasonal weakness. Bradley cycle is turned down thru year end.
Did $65 OIL spook market? when $64 didn't? Go Hummer
Duratek
SITE FOR Advance Decline Data
http://unicorn.us.com/advdec/
Sorry for line bleed, happens once in awhile. Why I need my OWN site developed but not just yet.
Watch action, near term NEG IMHO if we reverse to RED today. I had suggested a 2 day FED jig was all I expected.
D
Sorry for line bleed, happens once in awhile. Why I need my OWN site developed but not just yet.
Watch action, near term NEG IMHO if we reverse to RED today. I had suggested a 2 day FED jig was all I expected.
D
From Peter Elaides
So far, this time around, the end of the generational bull market which began in 1974 was initially signaled in April 1998, the first time a "Sign of the Bear" was seen in over a quarter of a century. That signal coincided almost exactly with a major top in the advance/decline line and an all-time high in the Value Line Composite Index (geometric) which has not been surpassed to this day, over seven years later.
What are we thinking? We are thinking, admittedly based on very sparse history, that this time around there will be multiple signals. We have already seen two signals, the one just mentioned and a second one in September 2000, coinciding almost exactly with the all-time high in the New York Composite Index which lasted for over four years.
We are speculating that the next top of importance and the next decline of real significance, the generational decline that we have yet to see following the generational bull market, will be signaled by another "Sign of the Bear".
We say that now even though we realize that we are nowhere close to getting such a signal. In fact recent market behavior has been just the opposite of the behavior that is required to generate a "Sign of the Bear" signal. Over the past five trading days, every single day has seen an advance/decline ratio either greater than 1.95 or smaller than 0.65. The initial requirement for a "Sign of the Bear" is to see at least 21 consecutive days with no daily advance/decline ratio greater than 1.95 or less than 0.65. As you can see, recent behavior has been exactly opposite the behavior required for a "Sign of the Bear."
We could be wrong about our speculation and, indeed, the market could begin a great decline from current levels, but as we have explained over the past few weeks such behavior would not be expected until the advance/decline line of the York Stock Exchange begins to act negatively in respect to the major indexes. We have not seen that occur as yet. All the above does not preclude a meaningful decline from these levels and that remains our expectation, at least through today's market action.
What are we thinking? We are thinking, admittedly based on very sparse history, that this time around there will be multiple signals. We have already seen two signals, the one just mentioned and a second one in September 2000, coinciding almost exactly with the all-time high in the New York Composite Index which lasted for over four years.
We are speculating that the next top of importance and the next decline of real significance, the generational decline that we have yet to see following the generational bull market, will be signaled by another "Sign of the Bear".
We say that now even though we realize that we are nowhere close to getting such a signal. In fact recent market behavior has been just the opposite of the behavior that is required to generate a "Sign of the Bear" signal. Over the past five trading days, every single day has seen an advance/decline ratio either greater than 1.95 or smaller than 0.65. The initial requirement for a "Sign of the Bear" is to see at least 21 consecutive days with no daily advance/decline ratio greater than 1.95 or less than 0.65. As you can see, recent behavior has been exactly opposite the behavior required for a "Sign of the Bear."
We could be wrong about our speculation and, indeed, the market could begin a great decline from current levels, but as we have explained over the past few weeks such behavior would not be expected until the advance/decline line of the York Stock Exchange begins to act negatively in respect to the major indexes. We have not seen that occur as yet. All the above does not preclude a meaningful decline from these levels and that remains our expectation, at least through today's market action.
MIRAGE MARKET
damn mistifying isn't it? 2 day FED party at best IMHO. Strength of this not meaningful and taking out 3 day oversold McClellan IMHO was -156
Such FOOLISH market behavior. Mostly the little guy is just spectator as his funds go month after month into 401K etc.
BBI getting hammered again, and I wonder if not getting overdone here, mainly concerned with financing debt. NFLX has hurt them IMHO
DWA also sitting there wondering if worst is over.
D
Such FOOLISH market behavior. Mostly the little guy is just spectator as his funds go month after month into 401K etc.
BBI getting hammered again, and I wonder if not getting overdone here, mainly concerned with financing debt. NFLX has hurt them IMHO
DWA also sitting there wondering if worst is over.
D
READ SLOWLY
Stocks Open Higher on Fed Rate HikeWed 9:32AM ET - APU.S. stocks are trading higher Wednesday on the momentum generated by the hike in the fed funds rate Tuesday, which helped the Nikkei reach its highest level in about 16 months.
*That's a new one on me........I can't wait for next meeting
D
*That's a new one on me........I can't wait for next meeting
D
Productivity SLOWS, LAbor costs RISE
IN an interest rate rising environment
When I look at the data I have to go on, one thing strikes me in the face. The fact that in the face of 5 years of record home building and auto sales andhow that affects so many related industries, lowest interest rates in 45 years and Bush stimulus package, we have witnessed by many measures the WEAKEST recovery from Recession in history?
Now while MANY will trumpet the recent job report, it is obvious to me, we continue to lose high paying jobs and replace them with minimum wage positions at WalMart and Target or Burger King......is it any wonder the national savings rate has fallen to ZERO?
25% of recent mortagages were made to "sub-prime" candidates! Many are being made with no background check and NO DOWN PAYMENTS. Also many are interest only loans! We are trolling for the final list of buyers! As we already see 70% home ownership, it is close to as good as it gets.
WE also know that HELOC's and cash out refi's contributed mightily to Consumer spending last few years.
So, if all we have is a consumption society/economy, when we know we are already at historic highs is debt, and have no savings, is this where we begin a new era? Is this where we should stand tall and bullish? after most of the AMMO is spent?
When the big houses also own Hedge Funds and come in through them and buy SPX futures to induce rallies? Where we are close to highs in insider selling and distribution?
DO as you must, this time when trouble starts I dare say a bell won't ring.
To continue this folly economy, housing prices must continue to rise. After a near vertical rise in some markets, should we expect this?
Bushites will sing the man's praises, each time I see him I quickly change the channel. Energy bill give aways to the haves, higher energy prices for the nots, the misallocations and inequities continue......as our boys keep dying at a faster pace.
I don't suspect too many of you think of IRAQ when cutting the pot roast.
Duratek
When I look at the data I have to go on, one thing strikes me in the face. The fact that in the face of 5 years of record home building and auto sales andhow that affects so many related industries, lowest interest rates in 45 years and Bush stimulus package, we have witnessed by many measures the WEAKEST recovery from Recession in history?
Now while MANY will trumpet the recent job report, it is obvious to me, we continue to lose high paying jobs and replace them with minimum wage positions at WalMart and Target or Burger King......is it any wonder the national savings rate has fallen to ZERO?
25% of recent mortagages were made to "sub-prime" candidates! Many are being made with no background check and NO DOWN PAYMENTS. Also many are interest only loans! We are trolling for the final list of buyers! As we already see 70% home ownership, it is close to as good as it gets.
WE also know that HELOC's and cash out refi's contributed mightily to Consumer spending last few years.
So, if all we have is a consumption society/economy, when we know we are already at historic highs is debt, and have no savings, is this where we begin a new era? Is this where we should stand tall and bullish? after most of the AMMO is spent?
When the big houses also own Hedge Funds and come in through them and buy SPX futures to induce rallies? Where we are close to highs in insider selling and distribution?
DO as you must, this time when trouble starts I dare say a bell won't ring.
To continue this folly economy, housing prices must continue to rise. After a near vertical rise in some markets, should we expect this?
Bushites will sing the man's praises, each time I see him I quickly change the channel. Energy bill give aways to the haves, higher energy prices for the nots, the misallocations and inequities continue......as our boys keep dying at a faster pace.
I don't suspect too many of you think of IRAQ when cutting the pot roast.
Duratek
Tuesday, August 09, 2005
IS JAPAN THE PLACE TO BE?
Machinery orders jump 11.1% to five-year high
Core private-sector machinery orders increased a seasonally adjusted 11.1 percent in June from the previous month to 1.059 trillion yen, the highest level in five years, the government said Tuesday.
The figure, a leading indicator of corporate capital spending, is the highest since October 2000. It marked the first expansion in three months and the margin of increase topped the average market projection of 6.1 percent.
The 11.1 percent growth represents an unadjusted 5.4 percent increase from a year earlier, the Cabinet Office said.
By quarter, the orders rose 0.8 percent in the April-June period from the preceding quarter to 3.032 trillion yen for the third straight quarterly increase.
Looking ahead, the office projected that core machinery orders will expand 0.9 percent in the July-September period from the preceding quarter to 3.058 trillion yen.
Private-sector economists said the data underlines a growing corporate appetite for spending on plants and equipment on the back of the sustained economic recovery.
"The latest data indicate the economy is rebounding from the soft patch that has lasted since the middle of last year," said Peter Morgan, chief economist at HSBC Securities (Japan) Ltd.
Morgan said he expects higher growth in core machinery orders in the July-September quarter, calling the government projection "pessimistic."
The larger than expected growth in core machinery orders led the government to revise upward its assessment of such orders for the first time in six months.
Core machinery orders were "marking a gradual increase," the Cabinet Office said. In May, the office said the trend of the orders was "flat."
According to the Cabinet Office, orders from manufacturers rose 14.9 percent in June to 465.4 billion yen, rebounding from a 20.6 percent fall in May.
Orders from nonmanufacturers climbed 8.0 percent to 595.6 billion yen after a 1.5 percent increase in May.
The Japan Times: Aug. 10, 2005
Core private-sector machinery orders increased a seasonally adjusted 11.1 percent in June from the previous month to 1.059 trillion yen, the highest level in five years, the government said Tuesday.
The figure, a leading indicator of corporate capital spending, is the highest since October 2000. It marked the first expansion in three months and the margin of increase topped the average market projection of 6.1 percent.
The 11.1 percent growth represents an unadjusted 5.4 percent increase from a year earlier, the Cabinet Office said.
By quarter, the orders rose 0.8 percent in the April-June period from the preceding quarter to 3.032 trillion yen for the third straight quarterly increase.
Looking ahead, the office projected that core machinery orders will expand 0.9 percent in the July-September period from the preceding quarter to 3.058 trillion yen.
Private-sector economists said the data underlines a growing corporate appetite for spending on plants and equipment on the back of the sustained economic recovery.
"The latest data indicate the economy is rebounding from the soft patch that has lasted since the middle of last year," said Peter Morgan, chief economist at HSBC Securities (Japan) Ltd.
Morgan said he expects higher growth in core machinery orders in the July-September quarter, calling the government projection "pessimistic."
The larger than expected growth in core machinery orders led the government to revise upward its assessment of such orders for the first time in six months.
Core machinery orders were "marking a gradual increase," the Cabinet Office said. In May, the office said the trend of the orders was "flat."
According to the Cabinet Office, orders from manufacturers rose 14.9 percent in June to 465.4 billion yen, rebounding from a 20.6 percent fall in May.
Orders from nonmanufacturers climbed 8.0 percent to 595.6 billion yen after a 1.5 percent increase in May.
The Japan Times: Aug. 10, 2005
MARKET COMMENTARY
WOO, CSCO matches estimates, off .65 last peek AH, not many of these techies look so good when the stock options are expensed, but maybe these wise guys feel that will never come. STOCK buybacks also PLUMP up the bottom line.
BIDU under a $100, maybe it's not another GOOGLE......maybe the traders aren't finished having fun with it yet. WHY BUY this POS? now KONG and SNDA also follow with less than exciting news....do we have a Chinese conundrum?
I am sick of the fun and games on FED day, how sad it is to feverishly wait at the computer to HEAR from above, almighty Greenspan has spoken....
"S T A T U S Q U O" long tern inflation is...." and all I hear is blah blah blah....
OHHHHH, maybe the tightening cycle is "nearing an end" the sheep bahhhhhh, now wouldn't that be peachy. END of tightening cycle is good news? (rates at 4 yr high)
10 walk on egg shells .25 hikes! PLEaaaseeeee, be a man, slap me with a .50 come on! he doesn't, because he KNOWS....how fragile our "recovery is" THAT it relies SOLEY on ASSET INFLATION, and expanding creidt to the consumer.
Let the consumer not pull away from debt buffet, we know how good the avg diet is....
My GUT tells me, tomorrow investors will NOT get excited about stocks, and my little pee brain wonders if the high in rates for this move is upon us.
My best performing dividend/high yield plays are BLE, GIM ETG EVT RCS NMY PCN PFL AND LASTLY ACG. Take a look at them, I use them to track reaction to interest rate movements, today most were green. There is NO WAY of course I can know how they perform in future, maybe my 6 laggards will perk up?
You can set them up on yhoo portfolio or find others similar you might be interested in to track their performance before you buy perhaps.
I find safety in numbers from this experiment and is why I think they have done OK so far, as some are up others down, but together I see green.....same thing when you go after ONE STOCK for the hit vs several in a field or such. Difference are that these pay nice dividends.
Duratek
BIDU under a $100, maybe it's not another GOOGLE......maybe the traders aren't finished having fun with it yet. WHY BUY this POS? now KONG and SNDA also follow with less than exciting news....do we have a Chinese conundrum?
I am sick of the fun and games on FED day, how sad it is to feverishly wait at the computer to HEAR from above, almighty Greenspan has spoken....
"S T A T U S Q U O" long tern inflation is...." and all I hear is blah blah blah....
OHHHHH, maybe the tightening cycle is "nearing an end" the sheep bahhhhhh, now wouldn't that be peachy. END of tightening cycle is good news? (rates at 4 yr high)
10 walk on egg shells .25 hikes! PLEaaaseeeee, be a man, slap me with a .50 come on! he doesn't, because he KNOWS....how fragile our "recovery is" THAT it relies SOLEY on ASSET INFLATION, and expanding creidt to the consumer.
Let the consumer not pull away from debt buffet, we know how good the avg diet is....
My GUT tells me, tomorrow investors will NOT get excited about stocks, and my little pee brain wonders if the high in rates for this move is upon us.
My best performing dividend/high yield plays are BLE, GIM ETG EVT RCS NMY PCN PFL AND LASTLY ACG. Take a look at them, I use them to track reaction to interest rate movements, today most were green. There is NO WAY of course I can know how they perform in future, maybe my 6 laggards will perk up?
You can set them up on yhoo portfolio or find others similar you might be interested in to track their performance before you buy perhaps.
I find safety in numbers from this experiment and is why I think they have done OK so far, as some are up others down, but together I see green.....same thing when you go after ONE STOCK for the hit vs several in a field or such. Difference are that these pay nice dividends.
Duratek
Mid Day COmmentary brief
BFD doodah doodah, wise guys running up to FED announcement. They KNOW what's coming,what if a .50 rise comes instead? .25 rises have done nothing for long term rates, THE CONUNDRUM!
The public at large knows not the GDP or BLS machinations, it's all pure BS to me, and it tells us nothing.
Help wanted at 37 tells me a lot! Minimum wage job expansion tells me a lot. Putrid wage gains tells me a lot.
Investor record bullishness....rally will be reversed end of day or tomorrow IMHO
D
The public at large knows not the GDP or BLS machinations, it's all pure BS to me, and it tells us nothing.
Help wanted at 37 tells me a lot! Minimum wage job expansion tells me a lot. Putrid wage gains tells me a lot.
Investor record bullishness....rally will be reversed end of day or tomorrow IMHO
D
GDP RENDERED MEANINGLESS
10:30AM: Major indices continue to hold their own but are showing little reaction to the latest economic report... At the top of the hour, June wholesale inventories rose 0.7% (consensus +0.4%), led by a 3.1% increase in auto inventories... While the inventory data don't usually garner much attention, they have gained some substance of late after inventory reductions shaved 2.3% off the advance read on Q2 GDP a week and a half ago... It is worth noting that strong inventory trends could lead to real GDP growth of 5% or more in for Q3...
We already know GDP is so contrived and manipulated to be meaningless.The things that would lower it left out, the things that would raise it embellished.
A RISE in inventories a good thing? maybe so, if they are bought! But it is allpart of the CONSUMER ECONOMY so out of balance and whack with a stable sustainable one.
Duratek
We already know GDP is so contrived and manipulated to be meaningless.The things that would lower it left out, the things that would raise it embellished.
A RISE in inventories a good thing? maybe so, if they are bought! But it is allpart of the CONSUMER ECONOMY so out of balance and whack with a stable sustainable one.
Duratek
ANOTHER PROFIT SQUEEZE
FLATTANING yield curve puts squueze on Banks. Is it ENERGY in the SPX now holding up profit expansion?
DO you like how Bush handed over Billions to the energy companies in his wonderful BILL? while NOT A DAMN WORD to improve conservation? improve mileage? which could impact oil prices most directly and quicker?
SAD my friends, sad, and no one will speak up! As what passes for good legislation hides croniism!
Duratek
DO you like how Bush handed over Billions to the energy companies in his wonderful BILL? while NOT A DAMN WORD to improve conservation? improve mileage? which could impact oil prices most directly and quicker?
SAD my friends, sad, and no one will speak up! As what passes for good legislation hides croniism!
Duratek
TUESDAY PRE-MARKET
Briefing.com reportts that productivity comes in at 2.2%, as it seems to me, UNIT LABOR COSTS are rising as PRODUCTIVITY is falling, is the tech miracle over? should pressure corporate profits.
MOMO for earnings has peaked IMHO, and I wonder if a significant market top is already in? as all indexes appear to have put in a top with small caps leading the way down this time.
ALL bullish letter writers are looking for no more that a correction, meaning buying the dip still applies, STAY 100% invested! This pervasive bullishness exists even though Bonds have outperformed stocks in general last 1 1/2 yr.
Daily sentiment to bonds has now dropped to 23% bulls, with 10 day moving avg still declining, getting NEAR previous low in price (high in yield) also near .618 FIB retrace. Some noted good market timers are sensing this and are reccomending more exposure to bonds.
And what will be the action surrounding todays FED meeting and anouncement? YOU KNOW, to ignore early action and 15 minutes AFTER meeting you wil see true direction....of which we can only guess.
Maybe the idiot who bought BIDU at open, market price at $82 first day is in green, but not to lemming at $153 near yesterdays HIGH and the REVERSAL to LOW of $115 or so, it is a traders market!
KONG dissapointed yesterday and I am glad I didn't play the Chinese connection BUT, I am not sure the LOVE for the fortune cookie is over yet. just look at NTES!! and SNDA.
A break of $284 in GOOG could be significant.
I may begin to EASE into 2 yr 5 yr and 10 yr Bonds today, again, worst I can do is have to hold to maturity, maybe some 90 day t-bills as well. Could sprinkle some high yielding bond funds also that don't hold JUNK BONDS, to add to diversity. I am pefecting a group list, may post in the near future, have been reluctant to reccomend specifics over general commentary of bigger picture.
My main goal is to help you stay on your guard, and see another potential is possible.
We saw new lows expand yesterday, now we watch to see if that trend continues. McClellan is now oversold, so some rally could be possible, but I feel greater market has turned.
We could be near the start of a SOLID metal correction, as sentiment remains near recent top highs, so lots of gold bugs to chew up and spit out before next rise begins. Also SILVER never confirmed golds rise....at some point I agree GOLD will be place to be.
Labor costs rising, energy in orbit, and housing still very speculative, FED in real conundrum......and in this must rise environment IMHO a bad place to be long without nimble feet.
The wall of worry is gone and all out there, what new menace awaits?
EWT explains laest report, Investors Intelligence shows a climax of BUYING CLIMAXES, where new 52 wk highs are made and then a down close for the week.....same as previous market highs, lookout IMHO short term.
SENTIMENT indicators are a traders best friend.
Duratek
MOMO for earnings has peaked IMHO, and I wonder if a significant market top is already in? as all indexes appear to have put in a top with small caps leading the way down this time.
ALL bullish letter writers are looking for no more that a correction, meaning buying the dip still applies, STAY 100% invested! This pervasive bullishness exists even though Bonds have outperformed stocks in general last 1 1/2 yr.
Daily sentiment to bonds has now dropped to 23% bulls, with 10 day moving avg still declining, getting NEAR previous low in price (high in yield) also near .618 FIB retrace. Some noted good market timers are sensing this and are reccomending more exposure to bonds.
And what will be the action surrounding todays FED meeting and anouncement? YOU KNOW, to ignore early action and 15 minutes AFTER meeting you wil see true direction....of which we can only guess.
Maybe the idiot who bought BIDU at open, market price at $82 first day is in green, but not to lemming at $153 near yesterdays HIGH and the REVERSAL to LOW of $115 or so, it is a traders market!
KONG dissapointed yesterday and I am glad I didn't play the Chinese connection BUT, I am not sure the LOVE for the fortune cookie is over yet. just look at NTES!! and SNDA.
A break of $284 in GOOG could be significant.
I may begin to EASE into 2 yr 5 yr and 10 yr Bonds today, again, worst I can do is have to hold to maturity, maybe some 90 day t-bills as well. Could sprinkle some high yielding bond funds also that don't hold JUNK BONDS, to add to diversity. I am pefecting a group list, may post in the near future, have been reluctant to reccomend specifics over general commentary of bigger picture.
My main goal is to help you stay on your guard, and see another potential is possible.
We saw new lows expand yesterday, now we watch to see if that trend continues. McClellan is now oversold, so some rally could be possible, but I feel greater market has turned.
We could be near the start of a SOLID metal correction, as sentiment remains near recent top highs, so lots of gold bugs to chew up and spit out before next rise begins. Also SILVER never confirmed golds rise....at some point I agree GOLD will be place to be.
Labor costs rising, energy in orbit, and housing still very speculative, FED in real conundrum......and in this must rise environment IMHO a bad place to be long without nimble feet.
The wall of worry is gone and all out there, what new menace awaits?
EWT explains laest report, Investors Intelligence shows a climax of BUYING CLIMAXES, where new 52 wk highs are made and then a down close for the week.....same as previous market highs, lookout IMHO short term.
SENTIMENT indicators are a traders best friend.
Duratek
Monday, August 08, 2005
ENERGY BILL A SHAM
Wednesday, October 1, 2003
Energy bill is bad idea made worse **(imagine what 2 more years did for it!! D)
SEATTLE POST-INTELLIGENCER EDITORIAL BOARD
If there were truth in lawmaking, the motto for the congressional team negotiating the energy bill would be: "We're making an awful plan worse."
Republican negotiators from the House and Senate could soon release the final energy bill. The plan started with flawed premises: giant tax breaks for energy companies, less environmental protection and no major push for conservation. But the lead Republican negotiators, Louisiana Rep. Billy Tauzin and New Mexico Sen. Pete Domenici, boldly have expanded the bill.
Domenici and Tauzin are loading up the legislation with special-interest favors. Nearly $1 billion could go to loan guarantees for a Minnesota coal gasification plant, a little more than a billion would back construction of an experimental nuclear power plant in Idaho. And the two leaders want an "inventory" of coastal energy resources, which could lead to oil drilling off Washington's coast.
If they can get away with it in the Senate, the Republicans will allow oil drilling in the Arctic National Wildlife Refuge. According to Roll Call newspaper on Capitol Hill, House Majority Leader Tom DeLay is eager for Arctic drilling, primarily to set a precedent that rolls over environmental concerns in a pristine area.
From this state's perspective, the bill will be a disaster if it promotes the Federal Energy Regulatory Commission's electricity deregulation agenda. Even without that, the bill is shaping up as an appalling collection of bad ideas that deserve a Senate filibuster.
ANOTHER ARTICLE
New U.S. Energy Bill speeds up oil reserve depletion, increases dangerous dependence on Middle East oil that threatens national and homeland security. Provides funding for major expansion of radioactive energy(Nukes)and continues focus on high polluting fossil energy. Discourages investment in abundant clean energy resources and and protects windfall profits of big oil and energy. Visit www.cleanpeace.org for more information.
(PRWEB) July 30, 2005 -- The energy bill Congress sent to the White House today guarantees America's continued dangerous, dependence on Middle East oil. The U.S. holds between 2 percent and 3 percent of world oil reserves, the Persian Gulf nations hold 50 percent and the Middle East dominated OPEC cartel controls 61 percent. Middle East dictators have oil staying power; the U. S. and Western democracies do not.“The bill subsidizes more rapid depletion of dwindling U.S. oil reserves. Subsidized oil production means faster oil depletion, an increasingly dangerous dependence on Middle East oil, the dictators who control it and the terrorists who influence them,” said author Roy McAlister, a Cleanpeace. org Co-President and a world authority on clean fuel production from wind, wave, biomass and solar energy.America's prosperity and security depend on adequate supplies of the cheap oil that powers the nation's economy. Increasing dependence on Middle East oil supplies that can be disrupted by violence or political change at any time threatens both. Without adequate cheap oil supplies America could face recessions, depression and worse.The energy bill's policies will not fill the oil gap, improve the environment, reduce global warming or encourage use of America's abundant undeletable energy.The bill heavily subsidizes depletable radioactive energy (nuclear power), coal and other fossil fuels while short-changing undepletable energy.This severe imbalance in funding and policy advantages makes fossil and radioactive energy appear less expensive than undepletable energy discouraging its commercialization and sustaining windfall profits for big oil.“Earth collects more energy from the sun in one day than all the oil it ever contained. Nature stores vast amounts of this energy in wind, wave action, biomass and direct solar in sun-scorched deserts. All these abundant forms of solar energy can be converted to hydrogen and fuel America's existing utility, industrial, transportation and agricultural engines without pollution.” said McAlister. But,Congress prefers to serve big oil profits rather focus policy and funding on this clean energy source that could bring real energy independence, cleaner air and water and strong national security.“The bill protects oil and OPEC from real competition. It stacks the competitive deck against undepletable energy and that stacks the deck against America.” said Bill Garrett, a Co-President of Cleanpeace.org, a non-profit clean, undepletable, energy advocacy group.Radioactive power (Nukes) can not safely fill the oil gap. The fossil resources subsidized by the energy bill cannot be mined and processed into oil fast enough to replace the gushes of oil that have fueled American and world prosperity. “The energy bill's priorities are simply wrong, Said Garrett.“It would take over 2000 mammoth one giga-watt radioactive fueled nuclear power plants to make up oil's decline. Storing and protecting the radioactive wastes these nuclear plants will produce prohibits nuclear power from being cost effective.” Said McAlisterMcAlister continued, “Congress' energy bill amounts to little more than a Big Oil boondoggle and a multi-billion dollar giveaway to giant energy corporations. It puts taxpayer money in the wrong place, at the wrong time and for the wrong reasons. It continues short-changing abundant solar resources and it fails to equalize subsidies and policy advantages between depletable energy and undepletable energy. The bill should be dubbed “The Great Mistake”“By passing this bill, Congress sent a message to America's friends and foes that the United States has surrendered its energy future to those who hold the oil when it needed to send a Declaration of Energy Independence and set an undepletable energy policy to back it up.” said Garrett.For more information:www.cleanpeace.org
Energy bill is bad idea made worse **(imagine what 2 more years did for it!! D)
SEATTLE POST-INTELLIGENCER EDITORIAL BOARD
If there were truth in lawmaking, the motto for the congressional team negotiating the energy bill would be: "We're making an awful plan worse."
Republican negotiators from the House and Senate could soon release the final energy bill. The plan started with flawed premises: giant tax breaks for energy companies, less environmental protection and no major push for conservation. But the lead Republican negotiators, Louisiana Rep. Billy Tauzin and New Mexico Sen. Pete Domenici, boldly have expanded the bill.
Domenici and Tauzin are loading up the legislation with special-interest favors. Nearly $1 billion could go to loan guarantees for a Minnesota coal gasification plant, a little more than a billion would back construction of an experimental nuclear power plant in Idaho. And the two leaders want an "inventory" of coastal energy resources, which could lead to oil drilling off Washington's coast.
If they can get away with it in the Senate, the Republicans will allow oil drilling in the Arctic National Wildlife Refuge. According to Roll Call newspaper on Capitol Hill, House Majority Leader Tom DeLay is eager for Arctic drilling, primarily to set a precedent that rolls over environmental concerns in a pristine area.
From this state's perspective, the bill will be a disaster if it promotes the Federal Energy Regulatory Commission's electricity deregulation agenda. Even without that, the bill is shaping up as an appalling collection of bad ideas that deserve a Senate filibuster.
ANOTHER ARTICLE
New U.S. Energy Bill speeds up oil reserve depletion, increases dangerous dependence on Middle East oil that threatens national and homeland security. Provides funding for major expansion of radioactive energy(Nukes)and continues focus on high polluting fossil energy. Discourages investment in abundant clean energy resources and and protects windfall profits of big oil and energy. Visit www.cleanpeace.org for more information.
(PRWEB) July 30, 2005 -- The energy bill Congress sent to the White House today guarantees America's continued dangerous, dependence on Middle East oil. The U.S. holds between 2 percent and 3 percent of world oil reserves, the Persian Gulf nations hold 50 percent and the Middle East dominated OPEC cartel controls 61 percent. Middle East dictators have oil staying power; the U. S. and Western democracies do not.“The bill subsidizes more rapid depletion of dwindling U.S. oil reserves. Subsidized oil production means faster oil depletion, an increasingly dangerous dependence on Middle East oil, the dictators who control it and the terrorists who influence them,” said author Roy McAlister, a Cleanpeace. org Co-President and a world authority on clean fuel production from wind, wave, biomass and solar energy.America's prosperity and security depend on adequate supplies of the cheap oil that powers the nation's economy. Increasing dependence on Middle East oil supplies that can be disrupted by violence or political change at any time threatens both. Without adequate cheap oil supplies America could face recessions, depression and worse.The energy bill's policies will not fill the oil gap, improve the environment, reduce global warming or encourage use of America's abundant undeletable energy.The bill heavily subsidizes depletable radioactive energy (nuclear power), coal and other fossil fuels while short-changing undepletable energy.This severe imbalance in funding and policy advantages makes fossil and radioactive energy appear less expensive than undepletable energy discouraging its commercialization and sustaining windfall profits for big oil.“Earth collects more energy from the sun in one day than all the oil it ever contained. Nature stores vast amounts of this energy in wind, wave action, biomass and direct solar in sun-scorched deserts. All these abundant forms of solar energy can be converted to hydrogen and fuel America's existing utility, industrial, transportation and agricultural engines without pollution.” said McAlister. But,Congress prefers to serve big oil profits rather focus policy and funding on this clean energy source that could bring real energy independence, cleaner air and water and strong national security.“The bill protects oil and OPEC from real competition. It stacks the competitive deck against undepletable energy and that stacks the deck against America.” said Bill Garrett, a Co-President of Cleanpeace.org, a non-profit clean, undepletable, energy advocacy group.Radioactive power (Nukes) can not safely fill the oil gap. The fossil resources subsidized by the energy bill cannot be mined and processed into oil fast enough to replace the gushes of oil that have fueled American and world prosperity. “The energy bill's priorities are simply wrong, Said Garrett.“It would take over 2000 mammoth one giga-watt radioactive fueled nuclear power plants to make up oil's decline. Storing and protecting the radioactive wastes these nuclear plants will produce prohibits nuclear power from being cost effective.” Said McAlisterMcAlister continued, “Congress' energy bill amounts to little more than a Big Oil boondoggle and a multi-billion dollar giveaway to giant energy corporations. It puts taxpayer money in the wrong place, at the wrong time and for the wrong reasons. It continues short-changing abundant solar resources and it fails to equalize subsidies and policy advantages between depletable energy and undepletable energy. The bill should be dubbed “The Great Mistake”“By passing this bill, Congress sent a message to America's friends and foes that the United States has surrendered its energy future to those who hold the oil when it needed to send a Declaration of Energy Independence and set an undepletable energy policy to back it up.” said Garrett.For more information:www.cleanpeace.org
BLACK GOLD RISING!
Attack fears? not a supply vs demand issue? New high, where's THE correction?
Funny how inflation doesn't show up in the CPI? not when you know the BLS figures incl GDP are BOGUS!
D
Funny how inflation doesn't show up in the CPI? not when you know the BLS figures incl GDP are BOGUS!
D
PREVIOUS GDP'S REVISED
http://www.bea.gov/bea/newsrel/gdpnewsrelease.htm
Eventually these hoodlums have to come clean!
Duratek
Eventually these hoodlums have to come clean!
Duratek
UPDATE BALTIC DRY INDEX
http://www.minyanville.com/university/fixedincome.htm?id=4712 (June 2004 the BDI plunged but then recovered and hit new highs)
SEE MY BDI CHART Since HIGH in 2005? a FALL of near 70% !!!
http://www.simonsresearch.com/pdf/Simons_0505.pdf#search='long%20term%20baltic%20dry%20index%20chart' More background.
WHat is the BDI telling us then?
D
SEE MY BDI CHART Since HIGH in 2005? a FALL of near 70% !!!
http://www.simonsresearch.com/pdf/Simons_0505.pdf#search='long%20term%20baltic%20dry%20index%20chart' More background.
WHat is the BDI telling us then?
D
LIGHT SWEET ALERT
Light, sweet crude for September delivery rose 40 cents to $62.71 in electronic trading on the New York Mercantile Exchange, off 19 cents from its new intraday high of $62.90.
Prices settled at $62.31 a barrel on Friday, a record close for crude since Nymex trading began in 1983.
That's at least 40 percent higher than a year ago, though crude prices would have to surpass $90 to reach the inflation-adjusted high set in 1980 *(boy that's reassuring! LOL)
A solid close above $63 would open the upside door, IMHO
D
Prices settled at $62.31 a barrel on Friday, a record close for crude since Nymex trading began in 1983.
That's at least 40 percent higher than a year ago, though crude prices would have to surpass $90 to reach the inflation-adjusted high set in 1980 *(boy that's reassuring! LOL)
A solid close above $63 would open the upside door, IMHO
D
DEBT GROWTH "IS" THE ECONOMY, PRECIPICE BALANCING
http://www.contraryinvestor.com/moprinter.htm (repost of VERY important read. AUGUST ESSAY)
Rarely do I repost a link, but I wanted to make sure all my readers got this one and spent the time reading and digesting it. If you hope to, or this is your desire to understand our current environment then do not skip over this read.
I finally got around to doing so this morning over coffee, and all I know was crystalized in an instant.
INDEED, our economy IS the housing market and the consumers ability to continue to EXPAND it's credit/debt now more than ever before.
More than 80% of previous GDP was housing and consumption!
Things are different this time?
Yes they are, after every previous RECESSION, Consumer's REAPAIRED their balance sheets, pulled in their horns. NOT this time! credit debt continued to expand even as housing prices rose, % of home equity has not! Homes were used as an ATM machine. (also consider NEXT Recession, we will have NO pent up demand to dig our way out!)
Knowing that SO many extremes exist, historical levels, and knowing that our entire economy depends on this continuing is what is at the root of my worry.
For those who think Alan Greenspan and the FED are some kind of miracle workers, may have a change of heart after reading this article.
I have made it my purpose, to cry out to anyone who will listen to consider what may lie ahead. And if I help ONE person avoid disaster, I can live with that.....should my concerns be born out.
Now, more than ever before, the shell game must continue, but of course indefinately it cannot, and it is MHO, we are at the "rubber meets the road" intersection. This folly of ever expanding debt and leverage already reaching new extremes, is running out of time.
Duratek
Rarely do I repost a link, but I wanted to make sure all my readers got this one and spent the time reading and digesting it. If you hope to, or this is your desire to understand our current environment then do not skip over this read.
I finally got around to doing so this morning over coffee, and all I know was crystalized in an instant.
INDEED, our economy IS the housing market and the consumers ability to continue to EXPAND it's credit/debt now more than ever before.
More than 80% of previous GDP was housing and consumption!
Things are different this time?
Yes they are, after every previous RECESSION, Consumer's REAPAIRED their balance sheets, pulled in their horns. NOT this time! credit debt continued to expand even as housing prices rose, % of home equity has not! Homes were used as an ATM machine. (also consider NEXT Recession, we will have NO pent up demand to dig our way out!)
Knowing that SO many extremes exist, historical levels, and knowing that our entire economy depends on this continuing is what is at the root of my worry.
For those who think Alan Greenspan and the FED are some kind of miracle workers, may have a change of heart after reading this article.
I have made it my purpose, to cry out to anyone who will listen to consider what may lie ahead. And if I help ONE person avoid disaster, I can live with that.....should my concerns be born out.
Now, more than ever before, the shell game must continue, but of course indefinately it cannot, and it is MHO, we are at the "rubber meets the road" intersection. This folly of ever expanding debt and leverage already reaching new extremes, is running out of time.
Duratek
Sunday, August 07, 2005
WEEKEND RAMBLE "Evidence Piling Up"
What keeps me up at night? How about a call at 2 AM that my 9 yr old son is having an asthma attack at his GRannies and the nebulizer is broken? and I had just taken a drousy pill because I couldn't sleep! EMT'S to the rescue.
I have this vision so here it goes:
The BDI has been falling and falling and the reason not so apparent as yet, but as I Have discussed before the Baltic Dry Index is a LEADING indicator and is not affiliated with any stock and is void of manipulation,one main reason I give it so much weight.
Friday EWT (elliott wave theory short term update) gave me some direction and inspiration, and here is what I think will happen.
If their call for LOWER GOLD and SILVER prices ahead comes true (though it seems like the dollar will weaken ahead because of sentiment picture, will it detach from gold relationship?) over the coming weeks and months, meaning FALLING metal prices, this would add evidence the economy is slowing especially if SILVER collapses as it is used in manufacturing.
If we see OIL finally correct and begin a decline BELOW recent trading range, it won't be because the economy is humming, and won't be bullish, it would come from flagging demand from a weakening economy.
In some respects then, when some feel rising oil is bearish, hello, the market was rising WITH OIL! perhaps at some point it crushes economy but we haven't reached that point.
What higher energy has done is rob EXTRA dollars that could be used elsewhere, yeah, for consumption and maybe maybe baby pay down debts? nah.......
Next Transports make a downward break for it confirming BDI action, and Dow begins its move to LOWER trading range. IMHO if at anytime the DOW breaks 10,000 with conviction on a closing basis even if this is nothing more than a pysch level....the selling with expand and intensify and leave the door open to test March or Oct lows.
I am unsure of intermediate interest movement, sentiment has come down good towards them, but they should move a little lower before attempting to rally in price, lower in yield.
You see my reasoning now about NOT getting in front of that Friday report? My TA didn't confirm it, neither did the top line number of jobs, even though the guess on NET BIRTH number was RIGHT ON!
Let's get with TREND, not make blind gambles, when a new trend can be confirmed then it is less risky to hop on....we shoot for SWEET SPOT not perfect low or high guess.
SOON, with bottoming bullish sentiment and a turn in my other TA going long bonds could be rather lucrative and much much safer, understand you could buy bonds at ANY price and get your yield, as long as you hold to maturity you get ALL your principle back, you only LOSE or GAIN when you sell ahead of maturity.
Check out 2 yr yields I think near 4% ! MOney markets are now CHALLENGING stock markets for performance! AFTER AUG 9TH FED MEETING THE YIELD WILL RISE AGAIN. ALL those jobs added to Disney World and Burger King cemented that IMHO.
What other area than ENERGY and HOUSING would influence prices? SO with PARABOLIC rise in housing and rocketing energy costs, how so NO INFLATION? believe what you want to, but friends, DEFLATION has a shot here.
It will show in collapsing stock prices, falling metals and oil, strengthening dollar, falling prices to attract business, rising bond prices lower yields as flight to safety comes in earnest, but maybe a SPRINT higher first to POP the housing bubble, isn't Greenspan knowingly or not doing that now? Doesn't King Midas always go too far?
Hey, the GOV added 26K jobs last month, whatever happened to Repub smaller government? Under the guise of security our RIGHTS are being taken away, and the gullable public just nods in acceptance.
Odd how many HORROR movies have come out this year? Some of the most violent films? BEAR does mysterious things.
Trying to catch up the money supply has gone vertical last 30 days, well behind Y/Y pace.
Has FED policy given us a balanced economy?
Nothing in straight line, no crash I can see, just a slosh down to bottom of trading range.
A sell off Monday would give us 3 consecutive down days, something that hasn't happened in awhile.
BIDU rise of a $27 IPO to $150 at high shows real color of investors, given the stock sells at 2,000 X earnings...... lemmings at work.
Crashing Financials and Housing Indexes will be strong sign the BACK BONE of economy is breaking.
Duratek
I have this vision so here it goes:
The BDI has been falling and falling and the reason not so apparent as yet, but as I Have discussed before the Baltic Dry Index is a LEADING indicator and is not affiliated with any stock and is void of manipulation,one main reason I give it so much weight.
Friday EWT (elliott wave theory short term update) gave me some direction and inspiration, and here is what I think will happen.
If their call for LOWER GOLD and SILVER prices ahead comes true (though it seems like the dollar will weaken ahead because of sentiment picture, will it detach from gold relationship?) over the coming weeks and months, meaning FALLING metal prices, this would add evidence the economy is slowing especially if SILVER collapses as it is used in manufacturing.
If we see OIL finally correct and begin a decline BELOW recent trading range, it won't be because the economy is humming, and won't be bullish, it would come from flagging demand from a weakening economy.
In some respects then, when some feel rising oil is bearish, hello, the market was rising WITH OIL! perhaps at some point it crushes economy but we haven't reached that point.
What higher energy has done is rob EXTRA dollars that could be used elsewhere, yeah, for consumption and maybe maybe baby pay down debts? nah.......
Next Transports make a downward break for it confirming BDI action, and Dow begins its move to LOWER trading range. IMHO if at anytime the DOW breaks 10,000 with conviction on a closing basis even if this is nothing more than a pysch level....the selling with expand and intensify and leave the door open to test March or Oct lows.
I am unsure of intermediate interest movement, sentiment has come down good towards them, but they should move a little lower before attempting to rally in price, lower in yield.
You see my reasoning now about NOT getting in front of that Friday report? My TA didn't confirm it, neither did the top line number of jobs, even though the guess on NET BIRTH number was RIGHT ON!
Let's get with TREND, not make blind gambles, when a new trend can be confirmed then it is less risky to hop on....we shoot for SWEET SPOT not perfect low or high guess.
SOON, with bottoming bullish sentiment and a turn in my other TA going long bonds could be rather lucrative and much much safer, understand you could buy bonds at ANY price and get your yield, as long as you hold to maturity you get ALL your principle back, you only LOSE or GAIN when you sell ahead of maturity.
Check out 2 yr yields I think near 4% ! MOney markets are now CHALLENGING stock markets for performance! AFTER AUG 9TH FED MEETING THE YIELD WILL RISE AGAIN. ALL those jobs added to Disney World and Burger King cemented that IMHO.
What other area than ENERGY and HOUSING would influence prices? SO with PARABOLIC rise in housing and rocketing energy costs, how so NO INFLATION? believe what you want to, but friends, DEFLATION has a shot here.
It will show in collapsing stock prices, falling metals and oil, strengthening dollar, falling prices to attract business, rising bond prices lower yields as flight to safety comes in earnest, but maybe a SPRINT higher first to POP the housing bubble, isn't Greenspan knowingly or not doing that now? Doesn't King Midas always go too far?
Hey, the GOV added 26K jobs last month, whatever happened to Repub smaller government? Under the guise of security our RIGHTS are being taken away, and the gullable public just nods in acceptance.
Odd how many HORROR movies have come out this year? Some of the most violent films? BEAR does mysterious things.
Trying to catch up the money supply has gone vertical last 30 days, well behind Y/Y pace.
Has FED policy given us a balanced economy?
Nothing in straight line, no crash I can see, just a slosh down to bottom of trading range.
A sell off Monday would give us 3 consecutive down days, something that hasn't happened in awhile.
BIDU rise of a $27 IPO to $150 at high shows real color of investors, given the stock sells at 2,000 X earnings...... lemmings at work.
Crashing Financials and Housing Indexes will be strong sign the BACK BONE of economy is breaking.
Duratek
Saturday, August 06, 2005
DOUG NOLAND'S CREDIT BUBBLE BULLETIN
http://prudentbear.com/creditbubblebulletin.asp (LONG READ GOOD READ) just part below
Since the inception of this approach several years ago, the central bank has raised its Federal funds rate 25 basis points after each meeting of the [FMOC]. Fed officials have tried to reassure market participants through frequent public utterances. This approach has wrought several unintended consequences. For one, it has contributed to a massive carry trade… This is because investors have been conditioned to expect moderate and steady increases in money rates, which their quantitative analysis shows will pose limited risks, if any, along the yield curve.
This, in turn, has led them to conclude that the carry trade can be the source of substantial profits… Although spread compression typically yields smaller profits from carry trades, profits have remained high as investors have enlarged their positions. In short, the Fed’s recent monetary approach, combined with the US Treasury’s practice of confining much of its new borrowing to short- and intermediate-term notes, explains a great deal of what the Fed has dubbed a “conundrum”… The second unintended consequence of the Fed’s measured response policy has been the massive growth of debt. Investors have reacted to the assurance of a measured response by borrowing more. In highly securitised and innovative financial markets, which by themselves encourage entrepreneurial financial behaviour, rapid debt growth is a natural consequence of measured response policies…”
But Age-Old Credit Inflation Dynamics dictate that the longer boom-time psychology becomes ingrained in the financial and asset markets; throughout financial institutions; in businesses, governments and households, the greater the monetary tightening inevitably required to goad the system back on a more sustainable course. It is the case that the longer and more robust the inflationary boom, the more spectacular and problematic the unavoidable bust. The dilemma today is that we are long past the point of any possibility for an orderly return to stability. The interest-rate markets are now faced with the prospect of guessing if the Fed will actually attempt a true tightening and, if so, how high will rates have to go?
Things have all the sudden become more challenging for the leveraged player and bullish bond pundit. The inflationary boom has become hard to deny and the fanciful imaginary world increasingly easy to rebut.
Since the inception of this approach several years ago, the central bank has raised its Federal funds rate 25 basis points after each meeting of the [FMOC]. Fed officials have tried to reassure market participants through frequent public utterances. This approach has wrought several unintended consequences. For one, it has contributed to a massive carry trade… This is because investors have been conditioned to expect moderate and steady increases in money rates, which their quantitative analysis shows will pose limited risks, if any, along the yield curve.
This, in turn, has led them to conclude that the carry trade can be the source of substantial profits… Although spread compression typically yields smaller profits from carry trades, profits have remained high as investors have enlarged their positions. In short, the Fed’s recent monetary approach, combined with the US Treasury’s practice of confining much of its new borrowing to short- and intermediate-term notes, explains a great deal of what the Fed has dubbed a “conundrum”… The second unintended consequence of the Fed’s measured response policy has been the massive growth of debt. Investors have reacted to the assurance of a measured response by borrowing more. In highly securitised and innovative financial markets, which by themselves encourage entrepreneurial financial behaviour, rapid debt growth is a natural consequence of measured response policies…”
But Age-Old Credit Inflation Dynamics dictate that the longer boom-time psychology becomes ingrained in the financial and asset markets; throughout financial institutions; in businesses, governments and households, the greater the monetary tightening inevitably required to goad the system back on a more sustainable course. It is the case that the longer and more robust the inflationary boom, the more spectacular and problematic the unavoidable bust. The dilemma today is that we are long past the point of any possibility for an orderly return to stability. The interest-rate markets are now faced with the prospect of guessing if the Fed will actually attempt a true tightening and, if so, how high will rates have to go?
Things have all the sudden become more challenging for the leveraged player and bullish bond pundit. The inflationary boom has become hard to deny and the fanciful imaginary world increasingly easy to rebut.
MUTUAL FUND CASH TO ASSET RATIO
Another email to friend this time KJ: (background this ratio was near 12% at 1980 bottom and has been near 4% recently...a historic LOW)
I have never seen it shown like( a graph) that but was aware of the 4% reading for the past several years.
I can only think it is the fed liquidity sliming into markets, if that ever shifts down NOTHING will hold the market up from an all out collapse.
And you see where it was at beginning of GREAT BULL> is why I say extremes are turned on their heads here and know what we are in.
The key is IF, mutual funds EVER get the liquidation that usually occurs at BOTTOMS, obviously the cash isn't enough to cover then stocks gets sold to raise cash yada yada, bad self fulfilling domino effect feeds on itself cycle to bottom.
Now, saying that, it surely has been at 4% or low for sometime, not sure if it's anything to worry about (immediately), or the stat is lulling us to sleep.
But EVIDENT from th egraph is that it always goes from one extreme to the other and back again.
D
I have never seen it shown like( a graph) that but was aware of the 4% reading for the past several years.
I can only think it is the fed liquidity sliming into markets, if that ever shifts down NOTHING will hold the market up from an all out collapse.
And you see where it was at beginning of GREAT BULL> is why I say extremes are turned on their heads here and know what we are in.
The key is IF, mutual funds EVER get the liquidation that usually occurs at BOTTOMS, obviously the cash isn't enough to cover then stocks gets sold to raise cash yada yada, bad self fulfilling domino effect feeds on itself cycle to bottom.
Now, saying that, it surely has been at 4% or low for sometime, not sure if it's anything to worry about (immediately), or the stat is lulling us to sleep.
But EVIDENT from th egraph is that it always goes from one extreme to the other and back again.
D
K-WINTER APPROACHING?
from an email to my buddy Matt:
I can have a rather sunny disposition, like to see funny side of things, but DAMN, aren't we set up for a possible repeat of 1929? SO MUCH THE SAME OR WORSE.
Now, all we could say is the FED will just print dollars and add to money supply, KEEP money easy. But you figure, they can't keep that UP indefinitely.
SEE how it already created record housing and energy prices.
See how it already created highest level of money supply (in 40 months created 6 X what money was ALREADY IN PRINT!) Adj monetary base has EXPLODED in last 30 days. (it was flat ALL year until then!) still lags 2004, and 2004 was not an exciting year for markets. (not) meaning MUCH MORE BANG needed for BUCK
Created BOND BUBBLE. Created mortagage debt bubble. And many other extremes.
We began 1980 era EXACT opposite of readings of today. THERE is limit as to what credit and debt can be expanded to, they won't talk about that.
WILL rates keep rising? I don’t know, but housing market was vulnerable to SATURATION before that with 70% home ownership rate!
Duratek
I can have a rather sunny disposition, like to see funny side of things, but DAMN, aren't we set up for a possible repeat of 1929? SO MUCH THE SAME OR WORSE.
Now, all we could say is the FED will just print dollars and add to money supply, KEEP money easy. But you figure, they can't keep that UP indefinitely.
SEE how it already created record housing and energy prices.
See how it already created highest level of money supply (in 40 months created 6 X what money was ALREADY IN PRINT!) Adj monetary base has EXPLODED in last 30 days. (it was flat ALL year until then!) still lags 2004, and 2004 was not an exciting year for markets. (not) meaning MUCH MORE BANG needed for BUCK
Created BOND BUBBLE. Created mortagage debt bubble. And many other extremes.
We began 1980 era EXACT opposite of readings of today. THERE is limit as to what credit and debt can be expanded to, they won't talk about that.
WILL rates keep rising? I don’t know, but housing market was vulnerable to SATURATION before that with 70% home ownership rate!
Duratek
EWT on MSFT
Category: Specific Markets
Question:
A weekly chart of Microsoft (MSFT) looks to me as if the stock may be completing a massive contracting triangle which has been in force since its December 2000 low. The year-long decline from the stock's all-time high in December 2000 looks impulsive, perhaps an a-wave of some degree, and the choppy, sideways action since could then be a b-wave triangle. This of course would portend a c-wave down to come that would likely be quite severe. What do you think?
Responder: Multi-Author
Date: 8/5/2005
I would tend to agree, particularly given the well-formed three-wave corrective rise from the low in December 2000. By my count, the overlapping rise from mid-2002 is wave C of the pattern. It is impossible to determine where we are in that C right now, although measurments put a target at $28.73 to $29.13, with the upside limit near $35. The triangle appears to need more work before completing, but most of that should be done at lower levels. (This analysis was performed by our Flash analysts who issue trading recommendations for single stocks in Prime Stocks Flash, one of our three Flash products. The Flashes are designed for investors who want to trade using the Wave Principle, but have no time or expertise to do so on their own. The Flashes give you actual trading recommendations on everything from individual stocks to futures. Our analysts pick the trades for you and contact you with exact instructions: what market, long or short trade, at what entry price, at what exit price, stop-loss, etc. Everything that goes into a trade, we give you. You then contact your broker and tell them to put on the trade. Or, you can authorize your broker to receive our recommendations directly. That way, you don't get personally involved in trading and let the professionals do everything for you. You'll find the full description of the Flashes here, and our Customer Service representatives could also help you with any questions.)
Question:
A weekly chart of Microsoft (MSFT) looks to me as if the stock may be completing a massive contracting triangle which has been in force since its December 2000 low. The year-long decline from the stock's all-time high in December 2000 looks impulsive, perhaps an a-wave of some degree, and the choppy, sideways action since could then be a b-wave triangle. This of course would portend a c-wave down to come that would likely be quite severe. What do you think?
Responder: Multi-Author
Date: 8/5/2005
I would tend to agree, particularly given the well-formed three-wave corrective rise from the low in December 2000. By my count, the overlapping rise from mid-2002 is wave C of the pattern. It is impossible to determine where we are in that C right now, although measurments put a target at $28.73 to $29.13, with the upside limit near $35. The triangle appears to need more work before completing, but most of that should be done at lower levels. (This analysis was performed by our Flash analysts who issue trading recommendations for single stocks in Prime Stocks Flash, one of our three Flash products. The Flashes are designed for investors who want to trade using the Wave Principle, but have no time or expertise to do so on their own. The Flashes give you actual trading recommendations on everything from individual stocks to futures. Our analysts pick the trades for you and contact you with exact instructions: what market, long or short trade, at what entry price, at what exit price, stop-loss, etc. Everything that goes into a trade, we give you. You then contact your broker and tell them to put on the trade. Or, you can authorize your broker to receive our recommendations directly. That way, you don't get personally involved in trading and let the professionals do everything for you. You'll find the full description of the Flashes here, and our Customer Service representatives could also help you with any questions.)
YOUR HOME AS ATM, AN UPSIDE DOWN WORLD!
Homeowners: Upside-down is no way to beAmericans own a lower percentage of their homes than in the past, increasing risk.
August 5, 2005: 12:55 PM EDT By Les Christie, CNN/Money staff writer
NEW YORK (CNN/Money) - So much for the American dream.
As more and more people have rushed to be homeowners, they actually own less of their homes than they have in decades...adding another risk factor to the overheated real estate market.
On average, homeowners have 56.3 percent equity in their homes, according to Demos, a public-interest research group. In 1973, equity averaged 68.3 percent; in the 1950s, it was upwards of 80 percent.
Two main factors are at work:
Homeowners are starting off further behind. In the past, the standard downpayment was 20 percent. A 2003 National Association of Realtors survey reported than less than half of all home buyers now put that much down; many obtain 100 percent, even 103 percent, financing.
Homeowners are yanking out cash. From 2001 through 2004, Americans took $330 billion in equity out of their homes, according Freddie Mac. In 2005 alone, they'll pull out as much as $160 billion.
Demos's senior research associate and author of A House of Cards: Refinancing the American Dream, Javier Silva, said that, even in the absence of a real estate crash, many families "are facing a financial crisis," partially because they've taken on more mortgage debt.
Already, the average American's financial obligations ratio (FOR) -- all your regular bills you must pay each month compared with income -- has expanded to 18.45 percent. That's up from about 15.5 percent in the early 1980s, and among the highest since the Federal Reserve began calculating the statistic.
Put to new uses
Until recently, according to Silva, homeowners cashed out home equity to pay for home renovations, college tuition, or maybe to start new businesses, all of which are reasonable motives.
Today, though, Silva says, many mortgage brokers have convinced consumers to cash out equity to buy new cars, boats, or other big ticket items.
But using home equity that way, he says, "is extremely risky. You're pulling equity out of your home – that's your family's security. And you're mixing bad credit with good."
He means that instead of paying off, say, a car loan in three or four years, paying for it by cashing out home equity adds the car cost to your mortgage. With interest rates so low, that may sound tempting.
But over a 30-year, six percent mortgage, that $20,000 car will cost more than $43,000, including interest, and you can still be paying for it long after it has hit the scrap heap.
Retiring bad debt
Some are also using home equity to pay off credit card debt.
Gerri Detweiler, author of The Ultimate Credit Handbook, has mixed feelings about cashing out home equity to pay off plastic. "Done properly, it can be beneficial," she said.
Before cashing out, though, Detweiler says your other financial fundamentals should be on solid ground -- don't take this step if you just got hit with a big pay cut -- and make sure you can handle the bigger mortgage payment.
And just because you can pay off it high-interest debt with low-interest debt, doesn't mean you shouldn't address why you're racking up debt in the first place.
If you just keep spending, you'll be worse off, because you won't have as much home-equity cushion.
Code red
Silva worries that if housing prices flatten out or decline, some newer homeowners who have built up little equity, could find themselves "upside down" -- owing more than their houses are worth.
And, if interest rates rise, homeowners with adjustable rate mortgages may not be able to keep up higher payments or sell the house for what they paid. Foreclosures could spike and the supply of homes for sale soar. That could send real estate market into a tumble.
"That's the scenario I'm most afraid of," said Silva, "and it's one that few economists acknowledge."
The thinking is that houses will maintain their value, as they have in the past, when housing never fell much more than 10 percent to 15 percent. "But prices are much higher than before in many markets," said Silva. Overinflated real estate, potentially, has a lot further to fall.
For more on cashing out on home equity, click here.
A poor credit rating can hurt in many ways. For more on that story, click here.
For more articles on Real Estate, subscribe to money magazine.
August 5, 2005: 12:55 PM EDT By Les Christie, CNN/Money staff writer
NEW YORK (CNN/Money) - So much for the American dream.
As more and more people have rushed to be homeowners, they actually own less of their homes than they have in decades...adding another risk factor to the overheated real estate market.
On average, homeowners have 56.3 percent equity in their homes, according to Demos, a public-interest research group. In 1973, equity averaged 68.3 percent; in the 1950s, it was upwards of 80 percent.
Two main factors are at work:
Homeowners are starting off further behind. In the past, the standard downpayment was 20 percent. A 2003 National Association of Realtors survey reported than less than half of all home buyers now put that much down; many obtain 100 percent, even 103 percent, financing.
Homeowners are yanking out cash. From 2001 through 2004, Americans took $330 billion in equity out of their homes, according Freddie Mac. In 2005 alone, they'll pull out as much as $160 billion.
Demos's senior research associate and author of A House of Cards: Refinancing the American Dream, Javier Silva, said that, even in the absence of a real estate crash, many families "are facing a financial crisis," partially because they've taken on more mortgage debt.
Already, the average American's financial obligations ratio (FOR) -- all your regular bills you must pay each month compared with income -- has expanded to 18.45 percent. That's up from about 15.5 percent in the early 1980s, and among the highest since the Federal Reserve began calculating the statistic.
Put to new uses
Until recently, according to Silva, homeowners cashed out home equity to pay for home renovations, college tuition, or maybe to start new businesses, all of which are reasonable motives.
Today, though, Silva says, many mortgage brokers have convinced consumers to cash out equity to buy new cars, boats, or other big ticket items.
But using home equity that way, he says, "is extremely risky. You're pulling equity out of your home – that's your family's security. And you're mixing bad credit with good."
He means that instead of paying off, say, a car loan in three or four years, paying for it by cashing out home equity adds the car cost to your mortgage. With interest rates so low, that may sound tempting.
But over a 30-year, six percent mortgage, that $20,000 car will cost more than $43,000, including interest, and you can still be paying for it long after it has hit the scrap heap.
Retiring bad debt
Some are also using home equity to pay off credit card debt.
Gerri Detweiler, author of The Ultimate Credit Handbook, has mixed feelings about cashing out home equity to pay off plastic. "Done properly, it can be beneficial," she said.
Before cashing out, though, Detweiler says your other financial fundamentals should be on solid ground -- don't take this step if you just got hit with a big pay cut -- and make sure you can handle the bigger mortgage payment.
And just because you can pay off it high-interest debt with low-interest debt, doesn't mean you shouldn't address why you're racking up debt in the first place.
If you just keep spending, you'll be worse off, because you won't have as much home-equity cushion.
Code red
Silva worries that if housing prices flatten out or decline, some newer homeowners who have built up little equity, could find themselves "upside down" -- owing more than their houses are worth.
And, if interest rates rise, homeowners with adjustable rate mortgages may not be able to keep up higher payments or sell the house for what they paid. Foreclosures could spike and the supply of homes for sale soar. That could send real estate market into a tumble.
"That's the scenario I'm most afraid of," said Silva, "and it's one that few economists acknowledge."
The thinking is that houses will maintain their value, as they have in the past, when housing never fell much more than 10 percent to 15 percent. "But prices are much higher than before in many markets," said Silva. Overinflated real estate, potentially, has a lot further to fall.
For more on cashing out on home equity, click here.
A poor credit rating can hurt in many ways. For more on that story, click here.
For more articles on Real Estate, subscribe to money magazine.
Friday, August 05, 2005
FEW MARKET CLOSE STATS
79% DOwn VOLUME
New lows expanding to 35, only 80 new highs
Interest rate breakout
Only 6 DOW 30 UP
Number of issues up and down per exchange
See you tomorrow hopefully
D
New lows expanding to 35, only 80 new highs
Interest rate breakout
Only 6 DOW 30 UP
Number of issues up and down per exchange
See you tomorrow hopefully
D
I Can't BELIEVE I am quoting Cramer!
Cramer said he doesn't mind expensive stocks, but he can't come up with an estimate that makes Baidu cheap. "I know people made a killing on Google. But Internet companies do not grow to the sky. And this is something that should have already been learned."
But he is right!!! Yes he is entertaining.
They HAVE NOT LEARNED, is exactly why you will understand PHASE II of the SECULAR BEAR MKT waits in the wings to remind them again!
When stocks fall from the highs by 20% there will be NO more arguing as to whether that is the case.
Duratek
But he is right!!! Yes he is entertaining.
They HAVE NOT LEARNED, is exactly why you will understand PHASE II of the SECULAR BEAR MKT waits in the wings to remind them again!
When stocks fall from the highs by 20% there will be NO more arguing as to whether that is the case.
Duratek
PSssstttttt
MAjority of "jobs" in BLS were "SERVICE SECTOR" jobs....you kow Burger King and such.
While another 4K FACTORY jobs went pffttt, perhaps some from factory shutdowns, hard to determine.
D
While another 4K FACTORY jobs went pffttt, perhaps some from factory shutdowns, hard to determine.
D
BIDU OPENS! CHinese GOOG??
FULL STORY
The American depositary shares were sold for $27 apiece late Thursday, above the high end of its once-raised price talk of $25. The stock will begin trading on the Nasdaq under the ticker BIDU. About 3.2 million of the shares were sold by the company, which will use the money for tech development and general purposes.
Baidu, a search engine that is occasionally billed as the Chinese Google (GOOG:Nasdaq - commentary - research), raised $109 million in the deal, which was led by Goldman Sachs, CSFB and Piper Jaffray. The IPO price values Baidu at around $870 million.
As the Chinese counterpart to Google (which owns 2.6% of the stock), Baidu.com is being compared to one of the hottest Wall Street IPOs of the last half-decade. Its revenue is only a fraction of Google's, but it has shown impressive growth in recent years, posting $4.5 million in operating cash flow in 2004 after breaking even the previous year.
Still, the company's overall market cap (not including the opening pop) is about 193 times the operating cash flow figure.
**Some one paid $82 (buy at market?) LIKE it's 1999 again!?? hmmm
Duratek...sad very sad and amusing...
The American depositary shares were sold for $27 apiece late Thursday, above the high end of its once-raised price talk of $25. The stock will begin trading on the Nasdaq under the ticker BIDU. About 3.2 million of the shares were sold by the company, which will use the money for tech development and general purposes.
Baidu, a search engine that is occasionally billed as the Chinese Google (GOOG:Nasdaq - commentary - research), raised $109 million in the deal, which was led by Goldman Sachs, CSFB and Piper Jaffray. The IPO price values Baidu at around $870 million.
As the Chinese counterpart to Google (which owns 2.6% of the stock), Baidu.com is being compared to one of the hottest Wall Street IPOs of the last half-decade. Its revenue is only a fraction of Google's, but it has shown impressive growth in recent years, posting $4.5 million in operating cash flow in 2004 after breaking even the previous year.
Still, the company's overall market cap (not including the opening pop) is about 193 times the operating cash flow figure.
**Some one paid $82 (buy at market?) LIKE it's 1999 again!?? hmmm
Duratek...sad very sad and amusing...
TNX TA ALERT
My chart (somewhere down the line I will buy the better stock charts service so I can doodle on my charts)
Observe please: ROC in rising teend (rate of change) has broken down trendline.
MACD high but turned up again. Histograms rising. FLAT 200 SMA and rising 50 SMA
Potential Doble bottom and reverse H and S formation. Portends a move towrads 4.6%
And it depends on bullish sentiment picture which is waning, and I guess more quickly now, will alert us of an impending short term low, IMHO
Duratek
Observe please: ROC in rising teend (rate of change) has broken down trendline.
MACD high but turned up again. Histograms rising. FLAT 200 SMA and rising 50 SMA
Potential Doble bottom and reverse H and S formation. Portends a move towrads 4.6%
And it depends on bullish sentiment picture which is waning, and I guess more quickly now, will alert us of an impending short term low, IMHO
Duratek
CHINESE GOOGLE??
8:55AM Baidu.com IPO prices above range; the Google of China? (BIDU) 27.00 :-Update- Baidu.com prices its IPO at $27, above the $23-25 estimated range, which had already been raised form $19-21. The co, which is called the "Google of China" by some, is the most used Chinese language Internet search provider. Baidu.com was the second largest website in China and the sixth largest website globally, as measured by user traffic during JulQ. Google (GOOG) owns 2.6% of the company. BIDU provides easy access to an index of over 740 mln web pages and offers a query-based online community, Baidu Post Bar, which currently consists of over 820,000 message boards. It auction-based pay-for-performance, or P4P, services allow customers to bid for priority placement. The co believes it is the first auction-based P4P service provider in China. The co is profitable and revenue last year was US$13.4 mln, up 187% yoy. Q1 revs were US$5.1 mln... Our Take: There is a lot of excitement about this deal as it's the largest search engine in a booming emerging economy. Also, its small size of 4.04 mln shares and the recent strong reports from fellow Chinese tech names (NTES, CTRP) is driving interest in the name. This is being led by CSFB and Goldman Sachs. Briefing.com Note: Telecom Communications (TCOM.OB) has seen a 49% advance since highlighted on Briefing Trader as a secondary play to the Baidu IPO.
**Q1 REVS $5 M??? Woof Big deal? worth $58 B huh? LOL
D
**Q1 REVS $5 M??? Woof Big deal? worth $58 B huh? LOL
D
WHAT I SAID LAST NIGHT as to YIELDS and NOW
"Back to TNX I can't always go 100% focus here so Ionly just plotted this out. we hit the 61.8% FIB retrace from the 2005 HIGH...within a smidge of it.had I grasped that little ditty, I would have swung into 5 or 10 years to some extent, BUT andmy analysis bears it out as to POTENTIAL JOB DATA UGLINESS FRI.......the chart does NOT entirely bear out a long position, the conundrum!But the pattern of the stochastics as you might observe has been consistant at each top, as it is now.My guess is that trend is still UP for yields, but tomorrow yields will fall hard, IF we get our miss."
As suggested, we did NOT get our MISS, yields are rising this AM, I haven't run my chart but I think it might suggest we challenge 2005 high in yields, tonights EWT will add some info I will pass on SAT.
PRE-MARKET can be tricky, less liquidity, low volume, so we must guage reaction by CLOSING NUMBERS ONLY!
As suggested, we did NOT get our MISS, yields are rising this AM, I haven't run my chart but I think it might suggest we challenge 2005 high in yields, tonights EWT will add some info I will pass on SAT.
PRE-MARKET can be tricky, less liquidity, low volume, so we must guage reaction by CLOSING NUMBERS ONLY!
JUNE saw job gains of 148K, but as I said the "model" added 184K so we actually lost 40K jobs without it?
Now we have opposite, took away 76K report sh0ws 207K added for miracle 283K plus or minus a tad...all STATISTICAL PAPER annotations. I would feel better if work week was on the rise! and help wanted was on the rise. they are not.
If we AVG in the last 2 months WITHOUT NET BIRTH MAGIC we get avg 121,500 Jobs added, if more correct shows weak job performance.
MR Market will let us know.
http://money.cnn.com/markets/morning_call/ Futures turned DOWN on the data, YIELDS ROSE. imagine that!http://goldseek.com (gold dollar bond data)
Duratek
SURPRISE JOB DATA LET'S HAVE A LOOK!
Briefing.com (click red link which is briefing.com if unaware of my website)
ODD recovery without GAINS in work week hours????
Net Birth death shows MINUS 76K, our reasoning was ON TARGET, the end result was not.
I did not take a position as I had reasoned not to last night based on my TA charts suggesting rising rates.
The number is suspect anyway, but you can only go as presented.
THIS NUMBER of 200K jobs is perhaps NOT the number many would have preferred??!!
Yes, this number is NOT the kind of number that SLOWS DOWN FED ACTION! SO the end game for the FED will NOT be shown IMHO at next meeting in 2 weeks.
In fact, based on their flawed data, they should SPEED up rate increases.
A rising rate environment WILL catch up with the markets. SO we watch todays stock market action and see the REACTION, and we might know more about the short term by this weekend.
Good luck to all, sometimes when I HOLD my gamblers finger in check I am happy (not jumping in front of todays numbers) and I am glad I gave WEIGHT to my charts which didn't line up with that notion, except the hit on the FIB.
Duratek
ODD recovery without GAINS in work week hours????
Net Birth death shows MINUS 76K, our reasoning was ON TARGET, the end result was not.
I did not take a position as I had reasoned not to last night based on my TA charts suggesting rising rates.
The number is suspect anyway, but you can only go as presented.
THIS NUMBER of 200K jobs is perhaps NOT the number many would have preferred??!!
Yes, this number is NOT the kind of number that SLOWS DOWN FED ACTION! SO the end game for the FED will NOT be shown IMHO at next meeting in 2 weeks.
In fact, based on their flawed data, they should SPEED up rate increases.
A rising rate environment WILL catch up with the markets. SO we watch todays stock market action and see the REACTION, and we might know more about the short term by this weekend.
Good luck to all, sometimes when I HOLD my gamblers finger in check I am happy (not jumping in front of todays numbers) and I am glad I gave WEIGHT to my charts which didn't line up with that notion, except the hit on the FIB.
Duratek
ONE FOR THE ROAD FRI PRE-MARKET COMMENTS
I made my case for this AM's job data being a HUGE miss, but if it isn't we'll see why in NET/BIRTH DEATH data.
Reaction to such perhaps is more important then the data itself.
SINCE 1982 when Greenspan took over the FED, he has launched one of the MOST AGGRESSIVE interest rate cutting sprees in history.
before him was Paul Volker, who stepped in and raised rates to squash rampant inflation which brought us record gold prices of the 70's.
For almost 25 years we have had a Bond Bull Market with falling rates.
To prick the bubble Greenspan raised rates maybe 3 X and you know the results.
Then he lowered them 13 X to 45 year lows. That set off a Cyclical Bull Market (usually lasting avg 3 years) Prior Bull was Secular in nature.
Just as in 1930's after collapse, lowered rates and crisis monetary policy has engineered a recovery and recoup of about 50% of the bear market losses (SPX).
But then in 1930-1932, is when the BEAR really caught fire, and destroyed the many, NOT 1929 CRASH!
I believe along with other Bears, this is going to repeat. Could the market continue higher?
You know it can, but I personally don't feel the risk is worth the reward, remember HOW far we have come!
I prefer to step aside or take a small short position thru RYDEX or URSA to position, this action is NOT reccomended for the AVG investor...again, for any bet you don't go ALL IN! Your gambles MUST always be measured and managable, and do your best to keep your losses small.
My charts show potential that rates could surge higher, but we have come to pivotal point, as I am typing this the JOB DATA will already have been released...and bonds will have reacted.
We don't begin another great bull burdoned by historic debt either or PE RATIO'S found more at previous TOPS than BOTTOMS.
More later, or Sat.
Duratek
Reaction to such perhaps is more important then the data itself.
SINCE 1982 when Greenspan took over the FED, he has launched one of the MOST AGGRESSIVE interest rate cutting sprees in history.
before him was Paul Volker, who stepped in and raised rates to squash rampant inflation which brought us record gold prices of the 70's.
For almost 25 years we have had a Bond Bull Market with falling rates.
To prick the bubble Greenspan raised rates maybe 3 X and you know the results.
Then he lowered them 13 X to 45 year lows. That set off a Cyclical Bull Market (usually lasting avg 3 years) Prior Bull was Secular in nature.
Just as in 1930's after collapse, lowered rates and crisis monetary policy has engineered a recovery and recoup of about 50% of the bear market losses (SPX).
But then in 1930-1932, is when the BEAR really caught fire, and destroyed the many, NOT 1929 CRASH!
I believe along with other Bears, this is going to repeat. Could the market continue higher?
You know it can, but I personally don't feel the risk is worth the reward, remember HOW far we have come!
I prefer to step aside or take a small short position thru RYDEX or URSA to position, this action is NOT reccomended for the AVG investor...again, for any bet you don't go ALL IN! Your gambles MUST always be measured and managable, and do your best to keep your losses small.
My charts show potential that rates could surge higher, but we have come to pivotal point, as I am typing this the JOB DATA will already have been released...and bonds will have reacted.
We don't begin another great bull burdoned by historic debt either or PE RATIO'S found more at previous TOPS than BOTTOMS.
More later, or Sat.
Duratek
NEM ON TRIAL
WHAT impact will this have on NEM stock? or is this "bad publicity" already factored in? What I wonder is just how many invested in NEM are even aware of this.
Watch and learn, between pollution control or lawsuits for lack of, and increase in energy costs, earnings are impaired.
Could set up possible downward thrust as kickoff to next leg down....not visable yet.
D
Watch and learn, between pollution control or lawsuits for lack of, and increase in energy costs, earnings are impaired.
Could set up possible downward thrust as kickoff to next leg down....not visable yet.
D
Thursday, August 04, 2005
END OF DAY TNX
*Welcome to all my new readers, let's enjoy the journey together and seek truth, eyes wide open. I LEAN BEAR (nahhhhhh) but am open to any opportunity. WHAT we MOST want is to avoid the BIG HIT! Like in 2001-2003, I was yelling loud and clear on Raging BUll back then and many did listen.
We don't have to run from ANY market, it's all about allocation and reallocation, and sometimes getting OUT near 100% to CASH!
Back to TNX I can't always go 100% focus here so Ionly just plotted this out. we hit the 61.8% FIB retrace from the 2005 HIGH...within a smidge of it.
had I grasped that little ditty, I would have swung into 5 or 10 years to some extent, BUT andmy analysis bears it out as to POTENTIAL JOB DATA UGLINESS FRI...
....the chart does NOT entirely bear out a long position, the conundrum!
But the pattern of the stochastics as you might observe has been consistant at each top, as it is now.
My guess is that trend is still UP for yields, but tomorrow yields will fall hard, IF we get our miss.
It will show up in the NET BIRTH DEATH, could they ADD JOBS INSTEAD? yeah! but they didn't in 2004, and if they don't in 2005 look out.....
How will market react?
SELLOFF very liekly, but you know these days, will the wise guys now think FED will stop raising rates? hence bullish to them?
FED knows of NET BIRTH DEATH.
If you put $100K in 10 years at 4.3% and the yield fell to 4.1%, you would make $2K on principle, and have some protection to your yield.
SO it's not SO much about PROFITS for most of us, it is about getting into something safe while protecting principle.
Those who bought at 2005 top have that!
Duratek
We don't have to run from ANY market, it's all about allocation and reallocation, and sometimes getting OUT near 100% to CASH!
Back to TNX I can't always go 100% focus here so Ionly just plotted this out. we hit the 61.8% FIB retrace from the 2005 HIGH...within a smidge of it.
had I grasped that little ditty, I would have swung into 5 or 10 years to some extent, BUT andmy analysis bears it out as to POTENTIAL JOB DATA UGLINESS FRI...
....the chart does NOT entirely bear out a long position, the conundrum!
But the pattern of the stochastics as you might observe has been consistant at each top, as it is now.
My guess is that trend is still UP for yields, but tomorrow yields will fall hard, IF we get our miss.
It will show up in the NET BIRTH DEATH, could they ADD JOBS INSTEAD? yeah! but they didn't in 2004, and if they don't in 2005 look out.....
How will market react?
SELLOFF very liekly, but you know these days, will the wise guys now think FED will stop raising rates? hence bullish to them?
FED knows of NET BIRTH DEATH.
If you put $100K in 10 years at 4.3% and the yield fell to 4.1%, you would make $2K on principle, and have some protection to your yield.
SO it's not SO much about PROFITS for most of us, it is about getting into something safe while protecting principle.
Those who bought at 2005 top have that!
Duratek
AM ACTION Jackson
"Let me....entertain you....."
Wal-Mart (WMT 49.41 -0.27) reported strong comps of 4.7% (consensus 4.3%) and now expects Aug. comps to rise 3-5% but rival Target (TGT 56.31 -1.36) has posted a 5.5% rise in July comps (consensus +5.7%) and downside Q2 sales guidance... Other notable retailers missing expectations and guiding lower include JCP (-4.7%), FDO (-3.8%) and GPS (-2.8%)... Consolidation throughout brokerage, banking and insurance, as well as a modest rise in benchmark yields, continue to pressure the Financial sector...
$50 like a STEEL CLAMP on WMT, selling on good news? hmmmm
BONDS ODDLY silent today ahead of FRI job data, here is what I said in an email to some friends this AM and I have been saying here:
"Any thoughts on my comments about bonds and tomorrows job data? http://www.bls.gov/web/cesbd.htm LOOK how close 2005 has followed 2004! LOOK at July -80K 2004....why I say look for HUGE mISS tomorrow, it might SHOCK markets, help bonds?I am looking for minus 100K jobs and I am the only one saying this. ALL the "expert" economists are looking for PLUS 180K or more
Your faithful analyst and born to be wild contrarian Duratek
Wal-Mart (WMT 49.41 -0.27) reported strong comps of 4.7% (consensus 4.3%) and now expects Aug. comps to rise 3-5% but rival Target (TGT 56.31 -1.36) has posted a 5.5% rise in July comps (consensus +5.7%) and downside Q2 sales guidance... Other notable retailers missing expectations and guiding lower include JCP (-4.7%), FDO (-3.8%) and GPS (-2.8%)... Consolidation throughout brokerage, banking and insurance, as well as a modest rise in benchmark yields, continue to pressure the Financial sector...
$50 like a STEEL CLAMP on WMT, selling on good news? hmmmm
BONDS ODDLY silent today ahead of FRI job data, here is what I said in an email to some friends this AM and I have been saying here:
"Any thoughts on my comments about bonds and tomorrows job data? http://www.bls.gov/web/cesbd.htm LOOK how close 2005 has followed 2004! LOOK at July -80K 2004....why I say look for HUGE mISS tomorrow, it might SHOCK markets, help bonds?I am looking for minus 100K jobs and I am the only one saying this. ALL the "expert" economists are looking for PLUS 180K or more
Your faithful analyst and born to be wild contrarian Duratek
SILVER
Down sharply this AM
ROC descending, and lower highs still intact. $7.12-$7.16 area to watch of converging moving averages.
Cycles show the metals usually weak into Sept, unless in BULL MKT. Hasn't shown yet
D
ROC descending, and lower highs still intact. $7.12-$7.16 area to watch of converging moving averages.
Cycles show the metals usually weak into Sept, unless in BULL MKT. Hasn't shown yet
D
WHAT RECOVERY?
Not here!
Average Workweek: an unchanged 33.7 hours where its been locked for 8 of the last 9 months.
Hasn't topped 33.8 hours since Sep 2002 as the lack of a stronger lift remains concerning.
Provides an indicator of immediate labor demand.
Hourly Earnings: A 0.3% gain leaves yoy growth dipping to 2.6%.
Feb 2004's 1.6% yoy low matched the 40 year low of Dec 1986 -- increased labor demand now provides the upward direction.
Average Workweek: an unchanged 33.7 hours where its been locked for 8 of the last 9 months.
Hasn't topped 33.8 hours since Sep 2002 as the lack of a stronger lift remains concerning.
Provides an indicator of immediate labor demand.
Hourly Earnings: A 0.3% gain leaves yoy growth dipping to 2.6%.
Feb 2004's 1.6% yoy low matched the 40 year low of Dec 1986 -- increased labor demand now provides the upward direction.
ADD also stuck on bottom HELP WANTED INDEX!
D
HIGHER ENERGY PRICES FUEL 2nd QTR EARNINGS
ENERGY prices are supporting rising SPX earnings. While this may look good, little else is gained from higher energy prices.
And going forward, where is the balance (financials now 20% of SPX earnings) to SPX earnings?
Falling commodity prices and slowing of housing sector could weigh heavily on stock valuations.
D
And going forward, where is the balance (financials now 20% of SPX earnings) to SPX earnings?
Falling commodity prices and slowing of housing sector could weigh heavily on stock valuations.
D
Wednesday, August 03, 2005
CLOSE UP OF THE 10 YR
It is impossible to call a top in yields based on this chart, IMHO
10 wk turning up, 50 WK flat. RSI is neutral MACD is rising. BANDS of ADX not at extremes.
But it could break either way anyhow. The daily doesn't show a reversal either
BUT point and figure chart shows what jmust happen. yields must rise to at least 4.6% to reverse bearish yields PO as shown.
Going below 4.0% on a closing basis would confirm lower yields.
10 wk turning up, 50 WK flat. RSI is neutral MACD is rising. BANDS of ADX not at extremes.
But it could break either way anyhow. The daily doesn't show a reversal either
BUT point and figure chart shows what jmust happen. yields must rise to at least 4.6% to reverse bearish yields PO as shown.
Going below 4.0% on a closing basis would confirm lower yields.
2 more days and Friday, should shed light on our environment......
DOW? a move to 10,200 is a long way off, but needed to quell bullish juices.
OH Darling GOOG? turned bearish on P and F
Duratek
REFLATION PERSCRIPTION HAS SIDE EFFECTS
Gasoline prices hit 12-year highThe price of nonpremium gasoline at the pumps was 128 yen per liter on average as of Monday, the highest level in 12 years, according to the Oil Information Center.
Prices rose 3 yen from the previous week, reaching their highest level since Aug. 30, 1993. The culprit is record-level crude prices, the industry body said Wednesday.
Oil distributors have passed on some of the increased oil import costs to gas stations by raising wholesale prices by more than 3 yen this month, it said.
The price of premium gasoline rose by 2 yen to 139 yen per liter, while that of diesel oil was up 2 yen to reach 104 yen.
The Japan Times: Aug. 4, 2005
Prices rose 3 yen from the previous week, reaching their highest level since Aug. 30, 1993. The culprit is record-level crude prices, the industry body said Wednesday.
Oil distributors have passed on some of the increased oil import costs to gas stations by raising wholesale prices by more than 3 yen this month, it said.
The price of premium gasoline rose by 2 yen to 139 yen per liter, while that of diesel oil was up 2 yen to reach 104 yen.
The Japan Times: Aug. 4, 2005
HOT HOT METAL GROUP
NEM up $2 CDE made nice move.PAL (recommended by a good trader friend) up LARGE! (paladium)
Is the bottom IN for gold? many of us wil be giving this heavy thought next few days, it may be. I willcheck EWT tonight and weigh back in.
When the SHIT hits the fan, gold and their shares could be the group that catches fire.
STill below its 2005 highs.
MArket treading water for FRI jobs data....you know my call there.
My hunch is to buy some 5 yr notes and some 10 yrs maybe, haven't yet. WORSE THING? I hold them to maturity.
My tendency is to bet large, and that is inhibiting me here.
If I was smart, I would plow into dividend tracking group and some in treasuries equaling 25% of my cash.
This is the pyramid, the BASE, most conservative at the base! The base MUST be strong. If economy weakens bonds should get bought.
If foreign hands sell, they get crushed! but why would they? INFLATION would do it.
90 day treasuries are cool, in 2 weeks they'll go up again after FED meeting.
But is it golds turn to get hot, next few days action could be very telling.
WILL FRIDAY be the turn day? Will weak jobs say whew to FED rate worry crowd? DEPENDS HOW WEAK, IMHO
Can job growth overcome a Net/Birth deduction? vs large additions as it has been? I rather DOUBT it. How reliable is the data anyway, not very
D
Is the bottom IN for gold? many of us wil be giving this heavy thought next few days, it may be. I willcheck EWT tonight and weigh back in.
When the SHIT hits the fan, gold and their shares could be the group that catches fire.
STill below its 2005 highs.
MArket treading water for FRI jobs data....you know my call there.
My hunch is to buy some 5 yr notes and some 10 yrs maybe, haven't yet. WORSE THING? I hold them to maturity.
My tendency is to bet large, and that is inhibiting me here.
If I was smart, I would plow into dividend tracking group and some in treasuries equaling 25% of my cash.
This is the pyramid, the BASE, most conservative at the base! The base MUST be strong. If economy weakens bonds should get bought.
If foreign hands sell, they get crushed! but why would they? INFLATION would do it.
90 day treasuries are cool, in 2 weeks they'll go up again after FED meeting.
But is it golds turn to get hot, next few days action could be very telling.
WILL FRIDAY be the turn day? Will weak jobs say whew to FED rate worry crowd? DEPENDS HOW WEAK, IMHO
Can job growth overcome a Net/Birth deduction? vs large additions as it has been? I rather DOUBT it. How reliable is the data anyway, not very
D
THE YING AND THE YANG OR HAVE I HAD TOO MUCH CAFFEINE
I just had a lovely talk with wonderful person, customer of mine, she's from England and after our talk I invited her to my blog.
She asked me what my motivation was, what drives me to read so much and post on my blog.
I said it was my nature to seek knowledge, and to figure things out, not quite obsessed by it, but more so than the average person.
I have been writing about issues for 7 years now. And my friends, you know the BEar MArkets worst days are ahead of us.
Cal me a conduit for further thought and enlightenment, because if we DON'T think for ourselves, our opinion will be handed to us, from the wise guy insiders no less, WHO by theby have been UNLOADING shares like there is NO tomorrow, hmmmmm just as the little guy is net long the markets?
The FED is boxed in now, MUST keep rates going higher even though non adjusted manipulated data would show a WEAK ECONOMY!
There is so much going on, it is hard to keep it all straight sometimes.
NO, the average person has neither the time nor inclinaton to spend thehours I do on this subject matter, and I gather this time better spent with family and friends, let me do the worrying for you.
REAL change is needed in our country, yet we voted in BUSH and gave SEAL of approval for actions in Iraq, if you voted for BUsh, do not complain.
We have insiders running this country and we have to wrestle it away from them! somehow.
So my job is to light a spark and make you think. The TRUTH will set you free.
WHO do you turn to for investment advice? Everyone's goals is not the same, a GOOD financial advisor should be able to look at your needs and risk tollerance and work with you, but yet, how do you know if they know?
When the going is good, it is hard to make a mistake, but when things change you MUST be liquid and you must adapt ahead of the herd.
That is the real challenge.BUT FIRST, let's try and keep what we got!
Duratek
She asked me what my motivation was, what drives me to read so much and post on my blog.
I said it was my nature to seek knowledge, and to figure things out, not quite obsessed by it, but more so than the average person.
I have been writing about issues for 7 years now. And my friends, you know the BEar MArkets worst days are ahead of us.
Cal me a conduit for further thought and enlightenment, because if we DON'T think for ourselves, our opinion will be handed to us, from the wise guy insiders no less, WHO by theby have been UNLOADING shares like there is NO tomorrow, hmmmmm just as the little guy is net long the markets?
The FED is boxed in now, MUST keep rates going higher even though non adjusted manipulated data would show a WEAK ECONOMY!
There is so much going on, it is hard to keep it all straight sometimes.
NO, the average person has neither the time nor inclinaton to spend thehours I do on this subject matter, and I gather this time better spent with family and friends, let me do the worrying for you.
REAL change is needed in our country, yet we voted in BUSH and gave SEAL of approval for actions in Iraq, if you voted for BUsh, do not complain.
We have insiders running this country and we have to wrestle it away from them! somehow.
So my job is to light a spark and make you think. The TRUTH will set you free.
WHO do you turn to for investment advice? Everyone's goals is not the same, a GOOD financial advisor should be able to look at your needs and risk tollerance and work with you, but yet, how do you know if they know?
When the going is good, it is hard to make a mistake, but when things change you MUST be liquid and you must adapt ahead of the herd.
That is the real challenge.BUT FIRST, let's try and keep what we got!
Duratek
BON BON
They taste sweet! but make you fat!
Treasuries rallying, maybe the play for this FRiday has already begun. You don't get bonds working like this if the economy was "on fire"! IMHO
Greenspan may want to dismiss the yield curve, we don't want to!
D
Treasuries rallying, maybe the play for this FRiday has already begun. You don't get bonds working like this if the economy was "on fire"! IMHO
Greenspan may want to dismiss the yield curve, we don't want to!
D
NEWS FLASH
Treasury Says 30-Year Bond Is Coming Back
Wed 9:07AM ET - AP
The Bush administration announced Wednesday that it is bringing back the 30-year Treasury bond next year, a move that would help finance the national debt and should hold appeal for investors looking for a safe, longer-term investment option in their portfolios.
**You could already BUY 30 yr bonds, but now the question is with INCREASED supply, will it be met with demand? There is NOT much difference in yield between 10 yr and 30 yr, maybe .20% !!
NOT much a premium for going our 20 more years? WILL increased supply affect price?
Wed 9:07AM ET - AP
The Bush administration announced Wednesday that it is bringing back the 30-year Treasury bond next year, a move that would help finance the national debt and should hold appeal for investors looking for a safe, longer-term investment option in their portfolios.
**You could already BUY 30 yr bonds, but now the question is with INCREASED supply, will it be met with demand? There is NOT much difference in yield between 10 yr and 30 yr, maybe .20% !!
NOT much a premium for going our 20 more years? WILL increased supply affect price?
Again, my thoughts go ahead to Friday, and wonder if I am correct about that report. When you look at net birth data do you see what I see? ONE MONTH that takes away jobs, that was July in 2004, will it be July again? or will it shift to Aug? I think this report will SPIKE volatility and send investors scurrying to bonds.
But, the technicals are not yet overbought and weekly just signalled higher rates, this we know can change rapidly.
If a recession is upon us by 2006, it would seem that bond yields would fall, there is no risk if you can HOLD your bonds to maturity, and another option is shorter maturity dates, spreading it out. 5 years are near 4%. COF BANK CD'S 5 yr yield 4.5%
There are options, or you could chase after rising stock prices hoping to sell them higher, as valuations are not the purpose.
SHould get VERY interesting indeed.
LITLLE GUY investor is historic net long, wise guys net short, who will win?
D
NTES
Chinese gaming industry boom? Stock is up $14 in pre market!
This is VERY unusual behavior! MANIA type price movement.
And I was wondering if SOHU and KONG etc will follow? Risky business trying to get in front of bubble behavior, but more of these report next week.
Seeing a stock fly $14 makes anyone wish they were there, feels like 1999/2000 all over again.
We are seeing manic herding into Chinese stocks, housing, energy, etc quite an amazing situation, BUBBLES ALWAYS BURST.....appetite for risk obviously has not been shackled, I am not sure how much further it can go.
And this type of behavior, is Greenspan watching? There will be NO hint of a slowing of the pace of the FED, IMHO
OH, NTES is a 24% jump from the close.
Duratek
This is VERY unusual behavior! MANIA type price movement.
And I was wondering if SOHU and KONG etc will follow? Risky business trying to get in front of bubble behavior, but more of these report next week.
Seeing a stock fly $14 makes anyone wish they were there, feels like 1999/2000 all over again.
We are seeing manic herding into Chinese stocks, housing, energy, etc quite an amazing situation, BUBBLES ALWAYS BURST.....appetite for risk obviously has not been shackled, I am not sure how much further it can go.
And this type of behavior, is Greenspan watching? There will be NO hint of a slowing of the pace of the FED, IMHO
OH, NTES is a 24% jump from the close.
Duratek
THE TRUTH BEHIND THE MYTH
Holy Grail Batman!
Pace of CASH OUT REFI's has NOT slowed! "Only 9 percent of refinancings resulted in lower loan amounts." ( I have always felt that HAD the refi boom LOWERED debt or helped to pay it off faster like a switch to 15 from 30 yr, DOWN the road we would have a BOOM like no other based on increased savings and ability to spend because of lower debt!, THIS didn't happen!)
"Now they refinance to put cash in their pockets or to pay for big purchases. " "Americans paid out $133 billion for home improvements in the 12 months ended June 30. "
Mortgage applications drop slightly
OIL prices set record again nearing $63 !! above $63 a break out could occur.
Toyota profit slips, but outlook solid
Surprise 9.7% fall in profit due to increased spending; another year of brisk sales seen.
We are in the midst of a VERY DANGEROUS climate! Housing inventories are rising as we reach 70% Home Ownership rate and one of the lowest NON OWNERSHIP rates ever. As yield curve flattens, as SHORT TERM rates are rising!!!!
Housing affordability is FALLING. RISING short term rates are being ignored, yield curve is being ignored, satiated housing AND AUTO market are being ignored.
WE have BURNED UP future demand, we are already at historic extremes.
FED policies have ignited the economy instead of letting it heal after last collapse, replaced it with an even larger imbalance!
Cyclical Bull is still in tact, but has gone nowhere since 2004, momo is slowing, but not bullishness.
FED policies have IGNITED SPECULATION a precursor to THE FALL!
WHat will ignite the decline? when will it come? this far into the cycle we are certainly closer to rough times than at the beginning of economic expansion.
Housing touches all phases of our economic lives, it is THE driver of the economy and we are near SATIATED in our demand.
WE have used HOME EQUITY to FUEL CONSUMPTION, not lower debt, we have sent debt to historic extremes.
This is a very dangerous cocktail, and I do fear the hangover is going to be ugly. Timing aside, all bubbles end the same way....history tells us that.
Sound economies don't sustain themselves from one asset inflator to another.
This echo rebound is about to contract.
Duratek
Pace of CASH OUT REFI's has NOT slowed! "Only 9 percent of refinancings resulted in lower loan amounts." ( I have always felt that HAD the refi boom LOWERED debt or helped to pay it off faster like a switch to 15 from 30 yr, DOWN the road we would have a BOOM like no other based on increased savings and ability to spend because of lower debt!, THIS didn't happen!)
"Now they refinance to put cash in their pockets or to pay for big purchases. " "Americans paid out $133 billion for home improvements in the 12 months ended June 30. "
Mortgage applications drop slightly
OIL prices set record again nearing $63 !! above $63 a break out could occur.
Toyota profit slips, but outlook solid
Surprise 9.7% fall in profit due to increased spending; another year of brisk sales seen.
We are in the midst of a VERY DANGEROUS climate! Housing inventories are rising as we reach 70% Home Ownership rate and one of the lowest NON OWNERSHIP rates ever. As yield curve flattens, as SHORT TERM rates are rising!!!!
Housing affordability is FALLING. RISING short term rates are being ignored, yield curve is being ignored, satiated housing AND AUTO market are being ignored.
WE have BURNED UP future demand, we are already at historic extremes.
FED policies have ignited the economy instead of letting it heal after last collapse, replaced it with an even larger imbalance!
Cyclical Bull is still in tact, but has gone nowhere since 2004, momo is slowing, but not bullishness.
FED policies have IGNITED SPECULATION a precursor to THE FALL!
WHat will ignite the decline? when will it come? this far into the cycle we are certainly closer to rough times than at the beginning of economic expansion.
Housing touches all phases of our economic lives, it is THE driver of the economy and we are near SATIATED in our demand.
WE have used HOME EQUITY to FUEL CONSUMPTION, not lower debt, we have sent debt to historic extremes.
This is a very dangerous cocktail, and I do fear the hangover is going to be ugly. Timing aside, all bubbles end the same way....history tells us that.
Sound economies don't sustain themselves from one asset inflator to another.
This echo rebound is about to contract.
Duratek
Tuesday, August 02, 2005
IT'S COME TO THIS
$$1,000,000 YES MILLION dollar trailer home, but its Malibu baby!
We are getting REAL close my friends, real close. Another great bull markets beginning with Million $$$ 1970 ish trailer homes NO land, and monthly land rent.
China stocks lighting up like Xmas trees, a $58 B Google, a LOT in Baltimore suburb for $500K and not the swankiest neighborhood.
Speculators getting special loans with no credit checks. 30% of homes and rising bought are 2nd homes or for outright resale.
FED says their tightening while liquidity runs wild in the other side of their mouth streets, and we DO have a "form" of INFLATION just as insidious as the form that comes from too little cash running after TOO FEW goods.
We have ASSET inflation. We have an economy drugged by cheap money that makes rich bankers and POOR debtors....a BUSH kinda world.
Where we help RISE UP a nation of billions to work for nothing, and industrialize their country with our dollars, we help militarize them, into world super power.
WE have NO savings, not a month goes by where wage growth outpaces spending.
WE are SO much poorer but yet don't know it.
A guy makes $500 a week. $40 to $75 goes to gas. If he lives in an apartment he pays maybe $200 WK towards that. Insurance is $50 wk. health insurance is $50 WK FOOD is $50 WK.
There goes his $500 wk but wait, he doesn;t clear that, maybe he clears $400 wk. If he buys any clothes or eats out, he does that on credit, of which he always owes and makes only minimum payments.
You can't own a home on $25 K a year, if married, maybe together avg couple makes $75K a year? $100K?
Can those people by a house? WHERE? MOntana? shhhhhh ADD now rising property tax and home insuarnce and maintanence.
RISING real estate as it has has lined the pockets of the financials......the fire has burned so bright, there is NO future demand down the road, only sellers.
NOBODY has any money yet consumers STORM the malls, saving be damned!
WE have no equilibrium, there is NO balance, we are out of control. WE are subsidizing the energy companies? also in a bubble?
There is nothing natural about this economy.
8,000 hedge funds many run by the big boys, there is NO free market.
Your choice, is to play the game, buy to sell higher, or take what yield you can get.
We are a ship without a captain, without a rudder, and its getting stormy, we are too closse to the rocks, the ship will break up.
EVERY DAY, EVERY $$ that goes on credit ADDS to an already historic high in debt, th e weight of it will crush us.
Without HEDONIC and statistical manipulations the economy would not look that good.
EMployees discounts to all? Yippeee.
The NEW CAFTA aggreemet will compound our problem of comeptiveness of labor.
To consumers, their is NO loyalty to anything made in this country, but greed. I have yet to come across a single person who minded buying Chinese.
LAST THOUGHT, it just hit me last night while eating CHINESE FOOD, the Fortune Cookies?........made in PA> !!
You tell me what joy or earnings isn;t out in the market? WHAT Wall? next is slippery slope. A Life where CRAMER is NOT a celebrity.
Duratek
We are getting REAL close my friends, real close. Another great bull markets beginning with Million $$$ 1970 ish trailer homes NO land, and monthly land rent.
China stocks lighting up like Xmas trees, a $58 B Google, a LOT in Baltimore suburb for $500K and not the swankiest neighborhood.
Speculators getting special loans with no credit checks. 30% of homes and rising bought are 2nd homes or for outright resale.
FED says their tightening while liquidity runs wild in the other side of their mouth streets, and we DO have a "form" of INFLATION just as insidious as the form that comes from too little cash running after TOO FEW goods.
We have ASSET inflation. We have an economy drugged by cheap money that makes rich bankers and POOR debtors....a BUSH kinda world.
Where we help RISE UP a nation of billions to work for nothing, and industrialize their country with our dollars, we help militarize them, into world super power.
WE have NO savings, not a month goes by where wage growth outpaces spending.
WE are SO much poorer but yet don't know it.
A guy makes $500 a week. $40 to $75 goes to gas. If he lives in an apartment he pays maybe $200 WK towards that. Insurance is $50 wk. health insurance is $50 WK FOOD is $50 WK.
There goes his $500 wk but wait, he doesn;t clear that, maybe he clears $400 wk. If he buys any clothes or eats out, he does that on credit, of which he always owes and makes only minimum payments.
You can't own a home on $25 K a year, if married, maybe together avg couple makes $75K a year? $100K?
Can those people by a house? WHERE? MOntana? shhhhhh ADD now rising property tax and home insuarnce and maintanence.
RISING real estate as it has has lined the pockets of the financials......the fire has burned so bright, there is NO future demand down the road, only sellers.
NOBODY has any money yet consumers STORM the malls, saving be damned!
WE have no equilibrium, there is NO balance, we are out of control. WE are subsidizing the energy companies? also in a bubble?
There is nothing natural about this economy.
8,000 hedge funds many run by the big boys, there is NO free market.
Your choice, is to play the game, buy to sell higher, or take what yield you can get.
We are a ship without a captain, without a rudder, and its getting stormy, we are too closse to the rocks, the ship will break up.
EVERY DAY, EVERY $$ that goes on credit ADDS to an already historic high in debt, th e weight of it will crush us.
Without HEDONIC and statistical manipulations the economy would not look that good.
EMployees discounts to all? Yippeee.
The NEW CAFTA aggreemet will compound our problem of comeptiveness of labor.
To consumers, their is NO loyalty to anything made in this country, but greed. I have yet to come across a single person who minded buying Chinese.
LAST THOUGHT, it just hit me last night while eating CHINESE FOOD, the Fortune Cookies?........made in PA> !!
You tell me what joy or earnings isn;t out in the market? WHAT Wall? next is slippery slope. A Life where CRAMER is NOT a celebrity.
Duratek
MOST DIFFICULT CALL
TNX CHART
In the face of exuberance, why would I even consider the 10 yr note, I mean WHO needs it?
But the 5 and 10 day averages are in unison, and pointing upward for yield. I looked longer, but this view is what I settled on. ROC has turned up and MACD has regained some footing turning up again.
WILL this ALL change Friday? My gut tells me YES. A HUGE miss is very possible in jobs data, this is my guess of course and gut call.
YET we have such a flooding on liquidity, money is flying into the markets, has been in housing, and it seems unstoppable. NOW CHINA is the play, surely all those billions need STUFF? all those Chinese companies should get played?
Maybe, NTES up $10 in AH! This is NOT normal stuff, this is blowoff blood gushing stuff, I really don;t know the end, I just know what that will look like.
CPC looked a tad high, so the upper limits , we are here, party on.....and then we'll see you on FRI!
D
In the face of exuberance, why would I even consider the 10 yr note, I mean WHO needs it?
But the 5 and 10 day averages are in unison, and pointing upward for yield. I looked longer, but this view is what I settled on. ROC has turned up and MACD has regained some footing turning up again.
WILL this ALL change Friday? My gut tells me YES. A HUGE miss is very possible in jobs data, this is my guess of course and gut call.
YET we have such a flooding on liquidity, money is flying into the markets, has been in housing, and it seems unstoppable. NOW CHINA is the play, surely all those billions need STUFF? all those Chinese companies should get played?
Maybe, NTES up $10 in AH! This is NOT normal stuff, this is blowoff blood gushing stuff, I really don;t know the end, I just know what that will look like.
CPC looked a tad high, so the upper limits , we are here, party on.....and then we'll see you on FRI!
D
Wave Strength
Wave Strength is a free email I receiver from Agora Publishingm missing are charts, one showing Q's price going UP as volume goes down. And the second is the chart detailing how overbought stocks are in their realtionshsip to be ing abnove their 20 50 and 200 moving averages, even without, I felt a read you should see.
D
TAN, DON'T BURN
By Eric J. Fry
Buy sunscreen, not Sun Microsystems...Such is the
approximate message delivered by several stock market
indicators, according to options pro, Jay Shartsis.
A dizzying array of troubling signs, omens and auguries are
warning that the stock market is due for a drop of some
significance. Net-net, August of 2005 might be a much
better month to buy coconut cocktails than common stocks.
"This summer," Shartsis says, "you're less likely to get
burned on a beach than on Wall Street."
Since late April, all the major stock market indices have
staged impressive rallies, lifting the S&P 500 and the
Nasdaq Composite Index to four-year highs. Not
surprisingly, therefore, most investors have rekindled
their passion for common stocks. Unfortunately, whenever
investors begin to love stocks too much, stocks begin to
abuse the affections of their admirers, by falling.
"Several gauges of investor sentiment are registering more
extreme readings than they did at the market top of March
7," Shartsis notes. "The 10-day CBOE put/call ratio, the
10-day Daily Sentiment Index (from MBH Commodity Advisors)
and the VIX Index of option volatilities are all showing
higher levels of investor bullishness – and lower levels of
fear – than they did at the market peak of March 7th.
"Before the March top, for example, the VIX dropped to
almost 12. That reading seemed pretty darn low at the time.
But guess what, last week the VIX hit almost 10, a new all-
time low!"
[Ed. note: The VIX measures the implied volatilities
of various options on the S&P 500 Index. Because the VIX is
based on real-time option prices, it reflects investors'
consensus view of future expected stock market volatility.
"During periods of financial stress, which are often
accompanied by steep market declines," the CBOE Website
explains, "option prices - and VIX - tend to rise. The
greater the fear, the higher the VIX level. As investor
fear subsides, option prices tend to decline, which in turn
causes VIX to decline."]
"Yeah," we replied, "the VIX has become a somewhat less
reliable indicator over the last few years, hasn't it?"
"Very true," said Shartsis, "but I still wouldn't ignore
the message it is sending. Investor complacency is
high...and that worries me."
"What else is worrying you?" we asked.
"Well, not that it makes any difference at all," he
replied, "but Vickers reports that insiders are selling
more than five shares for every one they buy, and this
reading is up from a recent 3.1 sells for every 1 buy."
"Presumably, the insiders know something more than
nothing," we noted.
"Presumably," the options pro concurred. "Or maybe they're
just as stupid as the rest of the 'smart money' has been
lately. I do find it interesting, however, that commercial
futures traders have become heavy sellers of stock futures.
This 'smart money' crowd of traders has been increasing its
net short positions in Dow, S&P and NDX futures. In fact,
the Commercials are holding their largest net-short
position in S&P futures since late January – shortly before
the market tumbled."
"So who's buying?" we wondered.
"Who else?" Shartsis replied, "the 'dumb money.' One of the
most notorious 'dumb money' groups has become mega-bullish.
The small-time option traders – those who buy or sell less
than 10 contracts at a time - have been aggressively buying
into the market. On only two prior occasions in the last
five years - July 21, 2000 and Jan. 16, 2004 - did small-
time options traders buy more call options than they did
last week. On both of those two prior occasions, they soon
regretted their buying binges...and they probably will
again this time."
"Interesting. What else troubles you?"
"Well, I would interpret the declining volume in QQQQs as a
bad omen"
"Why's that?" we asked.
"When traders are fearful," Shartsis explained, "they tend
to sell-short the Nasdaq 100 Trust Series ETF (QQQQ), which
tends to boost trading volume in the stock. So spikes in
QQQQ volume often signal a market bottom. Conversely, when
traders are highly confident, QQQQ volume diminishes. And
that's what's happening right now; QQQQs are continuing to
rally, even as the trading volume is sliding. I interpret
this divergence as a sign of complacency, and therefore, as
a warning of danger ahead."
"Okay, we will consider ourselves forewarned," we replied.
"Apart from the various sentiment indicators you mentioned,
are you seeing any other evidence of 'toppy' price action?"
"Sure, just take a look at the percentage of stocks above
their 10-week moving averages. In only about two months,
the percentage of NYSE issues trading above their 10-week
moving averages has gone from 16% to a recent reading of
80% - that's a very overbought reading.
"Of course, it can stay overbought for a while. Last
November, this indicator got up to 84% and stocks continued
rallying anyway, until finally breaking down hard in
January. I would also note that when this gauge climbed
from a low near 12% in May 2004 to its high of 84% in
November, the process took six months. But this year, the
identical price spike occurred in only two months! That's
some velocity, and is not a pace that is sustainable. So if
the percentage of NYSE stocks above their 10-week moving
average were to drop to 70%, I would take that as a clear
sell signal.
"For now, however, I'm just paralyzed," Shartsis concluded.
"This market is way too dangerous for my comfort level, but
its positive momentum dampens my enthusiasm for selling
stocks short. So I'm sitting on my hands. If I were long a
lot of stock, I'd be selling into the current strength. But
I wouldn't sell the market short until we see some sign
that the market's positive momentum is breaking down. We
haven't seen that yet."
"Okay," we replied, "we'll keep our eyes peeled. Anything
else bugging you, Jay?"
"Of course...But that's what therapy is for," he quipped.
"I think I've said enough for now."
"Thanks Jay. Maybe we'll see you out on the beach sometime
soon."
[Ed. Note: If you prefer to follow the 'smart' money you
need an experienced options guide. Steve Sarnoff has been
living and breathing options for over twenty years. For a
short time he is offering your entire money back if he
doesn't deliver 12 winners of at least 100% within a year.
To follow the 'smart' money, click here:
http://www.agora-inc.com/reports/OHL/WOHLF521
-------------------------
Did You Notice...?
By Carl Swenlin
The stock market doesn't move in a straight line, rather it
zigzags higher (or lower) in response to alternate waves of
buying and selling pressure. When we speak of the market as
being "overbought" we mean that buying pressure has
persisted long enough that it is likely to be exhausted.
A good way to determine overbought (and oversold)
conditions is by tracking the percentage of stocks above
their 20-, 50-, and 200-day moving averages, indicators
which measure market conditions in the short-, medium-, and
long-term respectively. The chart shows this set of
indicators for the stocks in the S&P 500 Index, and you
will note that they are all approaching the 90% level, a
level that represents the most extreme overbought
conditions.
Another notable feature on the chart is how the price index
has been making higher highs compared to the series of
lower tops on the index showing percentage of stocks above
their 200-EMA (the exponentially-weighted version of the
200-day moving average). This is a negative divergence.
Also, both the price index and the indicator are
approaching overhead resistance.
During a bull market, overbought conditions are not grounds
for going short, but they will generally result in minor
corrections or consolidations, so it is a good time to take
a closer look at stop loss points. Since the bull market is
nearly three years old, I think a higher degree of caution
is warranted because the bull market is closer to its end
than its beginning.
[Ed. Note: Carl Swenlin is the President of
decisionpoint.com, a website where you'll find all the info
you need to make solid investment decisions, organized into
charts and reports you can access with a click of your
mouse. Find out more here:
www.decisionpoint.com
------------------------
--------------------------------------------------------------------------------
The Rude Awakening is a free, daily e-mail service brought to you by the authors of The Daily Reckoning and the NY Times Business Bestseller Financial Reckoning Day .
To learn more or subscribe, see: http://www.dailyreckoning.com
D
TAN, DON'T BURN
By Eric J. Fry
Buy sunscreen, not Sun Microsystems...Such is the
approximate message delivered by several stock market
indicators, according to options pro, Jay Shartsis.
A dizzying array of troubling signs, omens and auguries are
warning that the stock market is due for a drop of some
significance. Net-net, August of 2005 might be a much
better month to buy coconut cocktails than common stocks.
"This summer," Shartsis says, "you're less likely to get
burned on a beach than on Wall Street."
Since late April, all the major stock market indices have
staged impressive rallies, lifting the S&P 500 and the
Nasdaq Composite Index to four-year highs. Not
surprisingly, therefore, most investors have rekindled
their passion for common stocks. Unfortunately, whenever
investors begin to love stocks too much, stocks begin to
abuse the affections of their admirers, by falling.
"Several gauges of investor sentiment are registering more
extreme readings than they did at the market top of March
7," Shartsis notes. "The 10-day CBOE put/call ratio, the
10-day Daily Sentiment Index (from MBH Commodity Advisors)
and the VIX Index of option volatilities are all showing
higher levels of investor bullishness – and lower levels of
fear – than they did at the market peak of March 7th.
"Before the March top, for example, the VIX dropped to
almost 12. That reading seemed pretty darn low at the time.
But guess what, last week the VIX hit almost 10, a new all-
time low!"
[Ed. note: The VIX measures the implied volatilities
of various options on the S&P 500 Index. Because the VIX is
based on real-time option prices, it reflects investors'
consensus view of future expected stock market volatility.
"During periods of financial stress, which are often
accompanied by steep market declines," the CBOE Website
explains, "option prices - and VIX - tend to rise. The
greater the fear, the higher the VIX level. As investor
fear subsides, option prices tend to decline, which in turn
causes VIX to decline."]
"Yeah," we replied, "the VIX has become a somewhat less
reliable indicator over the last few years, hasn't it?"
"Very true," said Shartsis, "but I still wouldn't ignore
the message it is sending. Investor complacency is
high...and that worries me."
"What else is worrying you?" we asked.
"Well, not that it makes any difference at all," he
replied, "but Vickers reports that insiders are selling
more than five shares for every one they buy, and this
reading is up from a recent 3.1 sells for every 1 buy."
"Presumably, the insiders know something more than
nothing," we noted.
"Presumably," the options pro concurred. "Or maybe they're
just as stupid as the rest of the 'smart money' has been
lately. I do find it interesting, however, that commercial
futures traders have become heavy sellers of stock futures.
This 'smart money' crowd of traders has been increasing its
net short positions in Dow, S&P and NDX futures. In fact,
the Commercials are holding their largest net-short
position in S&P futures since late January – shortly before
the market tumbled."
"So who's buying?" we wondered.
"Who else?" Shartsis replied, "the 'dumb money.' One of the
most notorious 'dumb money' groups has become mega-bullish.
The small-time option traders – those who buy or sell less
than 10 contracts at a time - have been aggressively buying
into the market. On only two prior occasions in the last
five years - July 21, 2000 and Jan. 16, 2004 - did small-
time options traders buy more call options than they did
last week. On both of those two prior occasions, they soon
regretted their buying binges...and they probably will
again this time."
"Interesting. What else troubles you?"
"Well, I would interpret the declining volume in QQQQs as a
bad omen"
"Why's that?" we asked.
"When traders are fearful," Shartsis explained, "they tend
to sell-short the Nasdaq 100 Trust Series ETF (QQQQ), which
tends to boost trading volume in the stock. So spikes in
QQQQ volume often signal a market bottom. Conversely, when
traders are highly confident, QQQQ volume diminishes. And
that's what's happening right now; QQQQs are continuing to
rally, even as the trading volume is sliding. I interpret
this divergence as a sign of complacency, and therefore, as
a warning of danger ahead."
"Okay, we will consider ourselves forewarned," we replied.
"Apart from the various sentiment indicators you mentioned,
are you seeing any other evidence of 'toppy' price action?"
"Sure, just take a look at the percentage of stocks above
their 10-week moving averages. In only about two months,
the percentage of NYSE issues trading above their 10-week
moving averages has gone from 16% to a recent reading of
80% - that's a very overbought reading.
"Of course, it can stay overbought for a while. Last
November, this indicator got up to 84% and stocks continued
rallying anyway, until finally breaking down hard in
January. I would also note that when this gauge climbed
from a low near 12% in May 2004 to its high of 84% in
November, the process took six months. But this year, the
identical price spike occurred in only two months! That's
some velocity, and is not a pace that is sustainable. So if
the percentage of NYSE stocks above their 10-week moving
average were to drop to 70%, I would take that as a clear
sell signal.
"For now, however, I'm just paralyzed," Shartsis concluded.
"This market is way too dangerous for my comfort level, but
its positive momentum dampens my enthusiasm for selling
stocks short. So I'm sitting on my hands. If I were long a
lot of stock, I'd be selling into the current strength. But
I wouldn't sell the market short until we see some sign
that the market's positive momentum is breaking down. We
haven't seen that yet."
"Okay," we replied, "we'll keep our eyes peeled. Anything
else bugging you, Jay?"
"Of course...But that's what therapy is for," he quipped.
"I think I've said enough for now."
"Thanks Jay. Maybe we'll see you out on the beach sometime
soon."
[Ed. Note: If you prefer to follow the 'smart' money you
need an experienced options guide. Steve Sarnoff has been
living and breathing options for over twenty years. For a
short time he is offering your entire money back if he
doesn't deliver 12 winners of at least 100% within a year.
To follow the 'smart' money, click here:
http://www.agora-inc.com/reports/OHL/WOHLF521
-------------------------
Did You Notice...?
By Carl Swenlin
The stock market doesn't move in a straight line, rather it
zigzags higher (or lower) in response to alternate waves of
buying and selling pressure. When we speak of the market as
being "overbought" we mean that buying pressure has
persisted long enough that it is likely to be exhausted.
A good way to determine overbought (and oversold)
conditions is by tracking the percentage of stocks above
their 20-, 50-, and 200-day moving averages, indicators
which measure market conditions in the short-, medium-, and
long-term respectively. The chart shows this set of
indicators for the stocks in the S&P 500 Index, and you
will note that they are all approaching the 90% level, a
level that represents the most extreme overbought
conditions.
Another notable feature on the chart is how the price index
has been making higher highs compared to the series of
lower tops on the index showing percentage of stocks above
their 200-EMA (the exponentially-weighted version of the
200-day moving average). This is a negative divergence.
Also, both the price index and the indicator are
approaching overhead resistance.
During a bull market, overbought conditions are not grounds
for going short, but they will generally result in minor
corrections or consolidations, so it is a good time to take
a closer look at stop loss points. Since the bull market is
nearly three years old, I think a higher degree of caution
is warranted because the bull market is closer to its end
than its beginning.
[Ed. Note: Carl Swenlin is the President of
decisionpoint.com, a website where you'll find all the info
you need to make solid investment decisions, organized into
charts and reports you can access with a click of your
mouse. Find out more here:
www.decisionpoint.com
------------------------
--------------------------------------------------------------------------------
The Rude Awakening is a free, daily e-mail service brought to you by the authors of The Daily Reckoning and the NY Times Business Bestseller Financial Reckoning Day .
To learn more or subscribe, see: http://www.dailyreckoning.com
OIL GO FIGURE
http://stockcharts.com/def/servlet/SC.pnf?c=$wtic,P
$83 Price objective. First is getting to the $63 box, then look out.
Been overbought on and off for a year and a half, but almost every chart I pullup screams OIL bull market.
WE got Cramer screaming it, Wall Street screaming it, the oil stocks screaming it, seems like a NO BRAINER right?
Chinese demand guarantees HIGHER prices right? or so it would seem.
STILL looking for that intraday rise and reverse, this rally is really feeding on itself.
I still think the bar doors swing open, and the bulls line up against the reality exposed in the coming job report.
I am verey alone in calling for a ghastly miss, but I stand by it.
D
$83 Price objective. First is getting to the $63 box, then look out.
Been overbought on and off for a year and a half, but almost every chart I pullup screams OIL bull market.
WE got Cramer screaming it, Wall Street screaming it, the oil stocks screaming it, seems like a NO BRAINER right?
Chinese demand guarantees HIGHER prices right? or so it would seem.
STILL looking for that intraday rise and reverse, this rally is really feeding on itself.
I still think the bar doors swing open, and the bulls line up against the reality exposed in the coming job report.
I am verey alone in calling for a ghastly miss, but I stand by it.
D
MAD ABOUT YOU
Cramer quoted almost every day now? Who knows, maybe he is right half the time...
SPX 1245 and DOW 10,717 key areas to wacth
D
SPX 1245 and DOW 10,717 key areas to wacth
D
Market Environment
I don't profess RUNNING after this market so late in the game IMHO, sure you can use STOPS to TRY and protect your positions.
But looking at new lows, until this indicator moves above 20 consistantly, the modus opportunity is for the bulls, and bears are a no show.
This is what the LOW VIX is saying, not to worry. The market won't get violent on downside without a move up in VIX IMHO.
From the kickoff at 10K we have moved up nicely for sure, and earnngs continue to be solid, so we cannot say from what we see YET, when the turn might come. We are still below 2005 highs, and below top range in what is still range bound market.
Trannies quiet today, and we still have that "odd" action of the BDI. We cannot see the future, but will certainly look back when hand is shown and what we saw will have new importance.
Unless they pull a fast one, and save the negative Net/Birth for next month, I JUST don't see how a strongly positive number will appear this Friday. I will stand for a horrid miss, maybe as bad as -100K
D
But looking at new lows, until this indicator moves above 20 consistantly, the modus opportunity is for the bulls, and bears are a no show.
This is what the LOW VIX is saying, not to worry. The market won't get violent on downside without a move up in VIX IMHO.
From the kickoff at 10K we have moved up nicely for sure, and earnngs continue to be solid, so we cannot say from what we see YET, when the turn might come. We are still below 2005 highs, and below top range in what is still range bound market.
Trannies quiet today, and we still have that "odd" action of the BDI. We cannot see the future, but will certainly look back when hand is shown and what we saw will have new importance.
Unless they pull a fast one, and save the negative Net/Birth for next month, I JUST don't see how a strongly positive number will appear this Friday. I will stand for a horrid miss, maybe as bad as -100K
D
2 Bearish data points
Investor's Intelligence Bulls/Bears+Bears (10 week moving average) .70
Insider's Sell/Buy Ratio (8 week moving average) 5.33
Insider's Sell/Buy Ratio (8 week moving average) 5.33
Housing Sentiment
Not a big deal, but I did a search on YHOO and here's the data.
HOUSING BUBBLE 1,830,000 hits
HOUSING BOOM 2,740,000 hits
GOOGLE SEARCH
BUBBLE 933,000
BOOM 1,740,000
Duratek......of course we take the contrarian position here.
HOUSING BUBBLE 1,830,000 hits
HOUSING BOOM 2,740,000 hits
GOOGLE SEARCH
BUBBLE 933,000
BOOM 1,740,000
Duratek......of course we take the contrarian position here.
"NO WAY CONSUMER WILL SLOW DOWN"
Bloomberg on AM DATA
BULLISH call on data and Consumer, of course the AUTO giveaway of last month helped this data.
But as I see it, auto and housing has been played to the extreme, and future demand has been played!
A dangerous situation should a Recession head our way, as OLD tricks might not work next time.
The FED may be even more inclined to continue raising rates, how about that. And when has a rising interest rate environment in the end been healthy for stocks?
SO far bond little changed, see if current FIB retrace holds tight.
Duratek
BULLISH call on data and Consumer, of course the AUTO giveaway of last month helped this data.
But as I see it, auto and housing has been played to the extreme, and future demand has been played!
A dangerous situation should a Recession head our way, as OLD tricks might not work next time.
The FED may be even more inclined to continue raising rates, how about that. And when has a rising interest rate environment in the end been healthy for stocks?
SO far bond little changed, see if current FIB retrace holds tight.
Duratek
SAVINGS FOR WHAT???
.01% Savings!! It's basically ZERO! (briefing.com)
SPENDING still outpacing ANY wage growth (shown as income), and we know where the difference is being made up.
It's Gov data by the way, so I'll take it with a grain of salt, watch bonds for reaction.
D
SPENDING still outpacing ANY wage growth (shown as income), and we know where the difference is being made up.
It's Gov data by the way, so I'll take it with a grain of salt, watch bonds for reaction.
D
CENTER COURT 10 YEAR TREASURIES
Japanese trader speaks Bloomberg story
There is a divergence in US and Euro Bonds, and it may be caused by the actions and perceptions described above, as Japanses traders SELL US debt for EUropean debt.
ANd I still ponder the Friday job report, and my comments still stand. 10 yr notes are AT .618 FIB retrace, we will quickly see if that pushes yield back down or it rise to next FIB.
But, it certainly seems MOST traders are of the mind that the US economy is STRONG and getting STRONGER, and isn't that a set up for a Contrarian move of another nature?
Duratek
There is a divergence in US and Euro Bonds, and it may be caused by the actions and perceptions described above, as Japanses traders SELL US debt for EUropean debt.
ANd I still ponder the Friday job report, and my comments still stand. 10 yr notes are AT .618 FIB retrace, we will quickly see if that pushes yield back down or it rise to next FIB.
But, it certainly seems MOST traders are of the mind that the US economy is STRONG and getting STRONGER, and isn't that a set up for a Contrarian move of another nature?
Duratek
Monday, August 01, 2005
Cramer and SBL
Several shows ago, CRAMER told his cult listeners he "wanted them in SBL",,,,but he had too much baggage to do it (meaning he paid too much and sold for loss).
CEO resigned today to go to NCR! STock now under $10. Thanks Cramer
Be all ears for more of his hyped up smoked up extreme bull show (though he does say sell certain stocks), it is a bull fest a ganza
D
CEO resigned today to go to NCR! STock now under $10. Thanks Cramer
Be all ears for more of his hyped up smoked up extreme bull show (though he does say sell certain stocks), it is a bull fest a ganza
D
HEDGE Funds, worth watching
INFLOWS dramatically slow.
Knowing their are 8,000 hedge funds now, they bear watching. a LOT of the markets attempted rally, was with HEDGE FUND MONEY.
And I think it is getting more unclear WHO is running the hedgies. GS owns several, they are tied at the hip, depend on them for VOLUME trading and more.
Investment BANKS and Hedge Funds, joined at the hip? Bears watching closely. ANd will hedge fund OUTFLOWS come next?
D
Knowing their are 8,000 hedge funds now, they bear watching. a LOT of the markets attempted rally, was with HEDGE FUND MONEY.
And I think it is getting more unclear WHO is running the hedgies. GS owns several, they are tied at the hip, depend on them for VOLUME trading and more.
Investment BANKS and Hedge Funds, joined at the hip? Bears watching closely. ANd will hedge fund OUTFLOWS come next?
D
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